At the start of the market today, the Dow was down more than 1,000 points and was down just over 500 points at 10:15. At 10:15, there were only 89 stocks up and a staggering 3,085 down on the NYSE.   There are now only 4 stocks at 52 week highs compared to 1,260 at new 52 week lows. In other words, it is ugly out there. What should an investor do now?

First, don’t get emotional and sell into the panic. To us, the key is to have your portfolio positioned correctly BEFORE the correction.   We went into this correction underweight in equities – we recently reduced our US large company exposure to the lowest in our firm’s history – and overweight in alternatives. On the fixed income side, we reduced our high-yield bond exposure to the lowest in our firm’s history. In many cases, clients have no exposure to high-yield bonds.

Because we are underweight equities, we have “powder dry” and will have the ability to buy into the market at the right time. Having almost 30 years of experience with market declines – 1987, 1990, 2000, 2008, to name a few – we have seen this before and are looking for signs to add to equities. We don’t believe the time is here yet. We expect volatility to continue in the weeks ahead – both up and down. This is not a time to get emotional. Rather, it is a time to be analytical in your decision making.

Feel free to call us anytime if you want to discuss the market and/or your portfolio.

Sincerely,

Your THOR Team