As the pundits were all being proved wrong and the U.S. presidential election began to swing to Donald Trump, world markets reacted. The Mexican peso sold down over 10% as investors wondered what all the rhetoric around trade, jobs and immigration meant for our neighbor to the south. Asian stock markets were open and trading down, with Japan down over 5%. The futures stock market saw the Dow Jones Industrials average down as much as 750 points (about 4%).
The unexpected result and the unknowns surrounding what the winner will do fed into this drop. U.S. investors may see selling on Wednesday after the election as markets open in our country. There may be significant bouts of selling over the next days, weeks or more.
We will be advising clients to stick with their investment plan, and when indicated, buy into these weak markets. They should stay disciplined to maintain their portfolio policy stock / bond mix. Market history tells us investors and markets overreact. People see others selling and their brain tells them they must do the same. T.V., social media, newspapers, all reinforce this bad behavior by over-reporting the volatile markets.
We hope investors don’t hurt themselves by running with the herd and selling without discipline, purpose, or thought. But when they do, we will be working hard to help our clients not make the same mistakes. Instead, we’ll help them take the steps to maintain their long-planned, purposeful construct.
In big market sell-offs, we will be buying.
If you’re looking for discipline and a partner who will help you stay on track give us a call to talk to a fiduciary adviser today.
Date Published: November 9, 2016
Authored By: T. Taylor Payne
Phone: (812) 603-6301
The information in this material is only as current as the date indicted, and may be superseded by subsequent market events or for other reasons. Statements concerning financial market trends are based on current market conditions, which are subject to change and which Payne Wealth Partners, Inc. does not undertake to update. While all information prepared in this document is believed to be accurate, any statements of opinion constitute only current opinions of Payne Wealth Partners, Inc., which are subject to change and which Payne Wealth Partners, Inc. does not undertake to update. Accordingly, you should not put undue reliance on these statements.