August 4, 2017

Feeling the Heat

Like a lot of Portlanders, I’ve recently spent a bit of money on fans and a portable air conditioning unit. Whether the hot streak is attributable to man-made climate change or merely to seasonal temperature spikes, the result is the same: sweaty days and uncomfortable nights. 

Many investors are feeling the same sort of discomfort when they read the current headlines. U.S. equity markets are at all-time highs and questions surround the leadership in Washington, as the Trump Administration has failed to pass large components of its legislative agenda and has become embroiled in controversy, while Congress has not yet taken up tax reform. Military saber rattling by North Korea, Russia, and China have also put investors on edge, as markets tend to disfavor the sort of surprises that military escalation may bring. Sweaty days and uncomfortable nights abound as we wait for the proverbial “other shoe” to drop.

Our view is that it is probably best that we treat our portfolios the same way we treat our homes — we don’t pick up and move when a heat wave rolls in; instead, we purchase those things that we need to get us through uncomfortably hot times. Arnerich Massena’s Investment Committee has been paying close attention, and we’ve been making adjustments in client portfolios to manage risk and generate opportunities for return. For investors, keeping a long-term perspective may require just shutting off the TV and limiting your exposure to the media for a few years! 

If you are feeling the heat in your portfolio, please reach out to the team at Arnerich Massena. We’d be happy to talk with you about how we’re working to weatherproof our client portfolios to maximize long-term performance through both hot and cold waves.