Before the COVID-19 coronavirus became a global pandemic, markets were in a ruthless uptrend. However, soon after governments around the world forced the closure of non-essential businesses and unemployment of millions, financial markets experienced a historic liquidation.
As part of a reflection on the events that transpired, Jonah Collier, Vice President at Collier Financial, spoke with Benzinga regarding recent volatility and steps he’s taken to protect investors from drawdowns.
About Collier Financial: Collier Financial is a family practice based out of Ann Arbor, Michigan, and Fort Wayne, Indiana. Since 1990, the firm has provided clients a launchpad for wealth accumulation and retirement via proprietary planning techniques that position clients for reduced risk, long-term growth opportunities.
“We’ve probably helped over 1,800 families throughout this area with their financial planning,” said Collier. “It’s the whole picture -- we bring in attorneys, CPAs, and money managers.”
Another Pullback: Alongside news of historic stimulus and improving pandemic conditions, the S&P 500 rose in excess of 40% since late March as participants discounted a new business cycle.
Despite the vast amount of opportunity created by the recent market rise, Collier has become concerned over the recovery.
“For those that are near or in retirement, I’m still urging caution because we do expect some sort of pullback,” he said. “As companies start reporting earnings and losses, we think it’s possible we’ll see another pullback. It makes sense to position for that, so the impact is less.”
Rebalancing Portfolios: In recognizing the increasing chance of another pullback, Collier Financial honed in on rebalancing and de-risking portfolios for more conservative investors.
The firm has remained in contact with clients regarding their objectives and financial wellbeing, leveraging updated income plans, Riskalyze tests, and account analyses to position current portfolios in-line with objectives, opportunity and risk.
“We’re in a new era now with what’s happening,” he noted. “You have a lot of unknowns and we’re looking at different money managers, the pilots that have flown through relatively stormy skies before, to spread risk and diversify.”
The firm took the recent rise in broad market equity indices as an opportunity to de-risk clients and increase exposure in fixed income and upside-only products.
“We’ve helped clients benefit from these types of products that have no risk and they can get a portion of the upside in markets with absolutely no risk -- if the markets go up, we’re going to capture a good chunk of it, but if the markets end up crashing, we won’t lose anything.”
The overall objective, Collier said, is to set clients on a successful journey to and through retirement: accumulating enough to maximize and optimize retirement assets, while addressing the impact of inflation and expected rates of return.
To get more in touch with your finances, or develop a launchpad for wealth accumulation and retirement, visit collierfinancial.com.
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