“THIS time…”

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“I bet you didn’t anticipate THIS!” I heard this from a few clients when Covid-19’s ramifications hit early in 2020, but it wasn’t the first time in my career I have heard that comment. I heard it after the tech bubble correction, again after “9-11”, and after just about every presidential elections, to list a few of the times I have heard “I bet you didn’t anticipate this”, often followed by “This time it’s different.”
Frankly, I did anticipate the tech bubble, just not its timing. As for the others, I didn’t know those
specific events would happen, but I didn’t need to. Here’s why: While the cause of major disruptions
almost by definition cannot be predicted, the consequences to the capital markets bear enough
similarities so as to be virtually predictable; at least predictable enough to minimize if not immunize
portfolios from significant permanent damage. Real (permanent) portfolio damage often occurs when
the investor was too greedy (i.e. concentration risk) prior to the disruption or reacted emotionally
after the disruption takes place.
2020 has indeed been…different, shall we say? But the volatility it brought to bear on the capital
markets mirrored volatility caused by previous crises. And like before, high quality, balanced
portfolios should weather this storm, too.

*Any opinions are those of Steven Gideon and not necessarily those of Raymond James. This material is being provided for informational purposes only and is not a complete description, nor is it a recommendation. 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 a loss regardless of strategy selected. Prior to making an investment decision, please consult with your financial advisor about your individual situation.