4Th Quarter 2020 Client Letter

I would like to wish you and your family a happy new year and hope everyone is safe.

Before we get to this year’s surprises, we need to remind ourselves of some historic firsts that not only made 2020 so memorable, but also laid the foundation for the strong market we hope to see ahead.

A global pandemic that hit the entire world almost at the same time. Rampant air travel and an intertwined global economy carried the novel coronavirus across borders and oceans within days, not months and years. The largest, quickest market drawdown in history. The largest-ever outperformance of growth vs. value in history. The quickest-ever development of a global vaccine in history.

This past quarter some value sectors have been playing catch up for example oil and gas, diversified banks and real estate- retail. As I always recommend, we want to invest in companies that are growing for the future not in companies making up for the mistakes they made in the past.

Now, the aspects of 2021 that make us optimistic;

Potentially a synchronized global economic recovery in history to begin midyear. Though large swaths of the global economy already are moving higher if not booming (think U.S. and Chinese manufacturing sectors, U.S. housing and, of course, all things technology and internet)

Largest-ever trailing 12-month buildup of fiscal and monetary stimulus. Congress approved $3 trillion of Covid relief and assistance last year, and trillions more seems possible.

Undervalued stocks, relative to their visible growth outlook, ever. As we emerge from the Covid crisis, the 10-year Treasury yield is just north of 1% and is likely to drift higher, but a breakout above 1.5% seems unlikely given global demographics and the ever-present central banks.

Recovering labor market, May and June alone saw 7 million jobs added, far more and faster than ever before. Nearly 11 million jobs were recovered in eight months.

Don’t forget about the digitization revolution, the biotech revolution, the manufacturing renaissance and  investors remain cautious with record cash levels.

2021 is a good reminder to all of us that while near-term risks and “black swans” abound, when the current is deep and strong and it’s going up, best not to swim against it. Always stay diversified!

I believe every solid relationship should center on open communication. You have several options to access the information you need to know about your portfolio, my firm, Raymond James and the financial markets. In addition to our in-person meetings and one-on-one calls, we'll also communicate with you through other channels, such as our website, newsletters and social media. You have already been receiving regular updates and emails from me. These communications are designed to provide you with insight into the ever-evolving financial markets and help build the confidence that comes from working with an experienced advisory team. If you haven't already done so, I encourage you to go to my website to learn more about my firm and access some of the recent research and articles available to you. I also utilize social media channels such as Linkedln. If you already have an account on Linkedln consider following me. These channels provide an excellent way for me to keep you up to date with relevant, timely news. Please let me know how you prefer to receive important communications and how frequently. We'll do our best to deliver. Guiding you toward financial independence is a collaborative process, and I hope you feel comfortable reaching out to me whenever you have questions, concerns or even new ideas to help me better serve you.

Regards,

Elliot Weissmark, CFP®, CPFA
Senior Vice President, Investments

Any opinion are those of Elliot Weissmark, CFP @, CPFA and not necessarily those of Raymond James. Expressions of opinion are as of this date and are subject to change without notice. There is no guarantee that these statements, opinions or forecasts provided herein will prove to be correct. Investing involves risk and you may incur a profit or loss regardless of strategy selected. Keep in mind that individuals cannot invest directly in any index, and index performance does not include transaction costs or other fees, which will affect actual investment performance. Individual investor's results will vary. Past performance does not guarantee future results. Future investment performance cannot be guaranteed, investment yields will fluctuate with market conditions. Prior to making an investment decision, please consult with your financial advisor about your individual situation. There is an inverse relationship between interest rate movements and bond prices. Generally, when interest rates rise, bond prices fall and when interest rates fall, bond prices generally rise.