Monthly Market Update: 
Recap of May 2020

Businesses are reopening and the markets have responded with optimism. Sure, if you turn on the news, there any many questions as to where we are headed due to the shutdown, riots occurring and tensions with China. To say the world is a bit crazy would be an understatement, but let’s not go down a rabbit trail. Instead, let’s take a look at what the markets did in May and what we are doing for your portfolios.

The month of May for the stock market was one you didn’t want to be on the sidelines for. If you have heard of the saying sell in May and go away, this month proved to be just the opposite and was a great example of why we do not market time.

For the month, the S&P 500 was +4.76%, the Dow +4.66%, the Nasdaq Composite +6.89%, MSCO EAFE +4.35%, MSCI Emerging Markets +.77%, Barclays US Aggregate Bond +.47%, Barclays US Corporate High Yield +4.41% and Barclays Municipal +3.18%,
 
At RightPlan, we re-balanced portfolios during the downturn. This created an opportunity to buy stocks at a lower price. Prior to and during the downturn, many of our portfolios held  bonds and specifically one of those bonds was long-term treasuries. These bonds have done well this year. They tend to be a safe haven when the stocks sell off.

To give you an idea on how long-term treasuries worked this year, look at this image from Jan.1 2020, through May 29, 2020.

 

 




 

 

 

 

 

 

 

 

 

 

The blue line is the Barclays US Long Term 20+ year treasury and the green line is the S&P 500. The 20+ year treasuries are +21.46% for the year, while the S&P 500 is -5.77%. Having bonds such as this helps decrease large swings in a portfolio and also eases some of the pain when a portfolio does go down. We’ve also added funds in our less aggressive portfolios that allow you to take part of a portion of the gains in the stock market without taking as much risk. Also for growth during the downturn, we increased our tech holdings. Tech has performed much better than the overall market during the crisis.

For the remainder of 2020 and moving forward, we want to continue to make sure you are comfortable with the investments we manage for you. With the rising prices in the stock market, this is a great time to ask yourself if you are ok emotionally with your portfolio. Are you questioning the markets or are you comfortable with the ups and downs you’ve seen? For each portfolio, we invest based on your comfort levels and also based on the needs of your plan, but if your investments are causing stress, it is time to have a conversation and we can make an adjustment. With all the time and effort you have put into earning your money, we want to make sure you do not make a decision that could cost you.

We are here for you and encourage you to stick to your financial plan. If you need anything at all, please reach out.
 

 

                                                                                

 

© 2020 by RightPlan Financial 

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