What a relief it is now that the presidential election is finally over, especially after months of building up, not to mention the constant barrage of political ads that, quite honestly, got annoying if I may say. One of the most heated elections in years resulted in Donald Trump being elected for his second term. While people’s reactions were varied and, in some cases, even extreme, the initial response by the markets was overwhelmingly positive, as the Dow, Nasdaq, S&P 500 and Russell 2000 all surged after the election. First, there was the relief that election results came in faster than expected. Then there’s the hope that Trump’s win and the policies to follow will all have a positive impact to the economy and promote growth, from lowering taxes to decreasing regulations and combating hot-button issues like inflation.
The market rally was further spurred a couple of days later when the FOMC (Federal Open Market Committee) announced that they would be cutting rates by another 25 basis points (0.25%). This was the second consecutive rate cut they’ve done recently. And it doesn’t stop there, as there is still the likelihood that the Federal Reserve – as it continuous to grapple with inflation – may once again cut rates at their December meeting (Dec. 17-18).
What an interesting couple of months it’s been. As I’ve previously noted, September is usually seen as the worst month for the markets, followed by a choppy and mixed October, yet both months were relatively calm, except for the last trading days in October leading up to the election when uncertainties were mounting.
What our data and our various money managers are showing us is that we have the ‘green light’ to keep invested. VIX, a barometer for market uncertainty and volatility, is in the low volatility zone and market breadth, a measure of when more stocks are advancing than declining, is continuing to improve, with small caps and the Russell 2000 index now marching along with the rest.
I know the year’s not over, but I am curious what new trends emerge when president-elect Trump takes office. With his plans for “drill, baby, drill” to provide reliable and affordable energy to Americans, along with his enthusiasm towards cryptocurrencies, what other asset classes might be worth considering as part of your allocation in the coming year?
The beautiful thing about our investing platform, which in our opinion is unmatched with our breadth of money managers, investing styles, along with access to all types of asset classes and strategies including gold, energy and even crypto, is that it allows us to move with, and respond to, the trends. This is vitally important because we can then help position you to participate as the markets go up yet have the defensive component should the markets go down. If you don’t have this yet in your portfolio or you’d like to learn how you can both grow and protect your investment and retirement assets, give us a call or send us an email. Until next time, have a wonderful and Blessed Thanksgiving.
If you need guidance on your portfolio, you can reach Chad Albano and the team at Global View Capital Advisors by scheduling an appointment here: https://app.acuityscheduling.com/schedule/7c4635ff
