The Fed’s unprecedented stimulus had a huge impact on the market in the second quarter; interest rates stabilized, the bond market snapped back, and the stock market rebounded significantly. We face an uncertain economy in the near term. Unemployment is still over 11%, a resurgence in COVID-19 cases continues to delay our recovery and material long-term changes seem to be developing in how we do business. The rapid market rebound makes it feel like the markets are disconnected from the actual state of our economy, but the market is always attempting to look forward. We look forward to the day when a vaccine is approved for use, a tangible path to recovery.
Diversification has never felt more important, nor has active management. That may seem counterintuitive when the stock market returns are so heavily driven by the top five names in the S&P 500. We believe there is so much more growth potential and opportunity to manage overall volatility and generate yield by investing broadly across the full spectrum of asset classes with high quality, proven money managers. This quarter could not have proven this theory any better.
In a world experiencing major changes, one thing remains constant: our advice to stay true to your long-term investment strategy with an eye for opportunity.
Click here to read our full 2Q20 Capital Market Review.