Ken's 1st Quarter 2020 Recap

April 10, 2020

Ken’s 1st Quarter 2020 Recap


Going to take a break from the regular format except for the stock market numbers.  Here they are:


1st Quarter Market Snapshot

Index:                                      Close 12/31/2019    Close 3/31/2020    1st Qtr 2020 +/-     2019 +/-

Dow Jones Industrial Average   28,538.44                 21,917.16            (23.20%)              22.34%

S&P 500                                     3,230.78                   2,584.59              (20.00%)              28.88%

NASDAQ                                    8,972.60                   7,700.10              (14.18%)              35.23%


Following a strong 2019, the US markets hit all time highs on Feb 20, but for the quarter they ended strongly negative after a major panic sale of stocks due to COVID-19 and its perceived effects on global economic forecasts.


As I write this the markets are off to a good start in April, in fact we are in striking distance of entering the next bull market already.  The talking heads fight over what defines a bull market or a bear market but I typically stay with the easy 20% number.  20% down from a peak constitutes a bear market and 20% up from a bottom constitutes a bull market.  If it breaks through, how long will this bull last?

(Source – Broadridge Investor Communication Solutions, Inc. - Quarterly Market Review: Jan 2019-Mar 2020.  Copyright 2020, Broadridge Investor Communication Solutions, Inc., All rights reserved.)

Chart reflects price changes, not total return. The Dow Jones Industrial Average (DJIA) is a price-weighted index composed of 30 widely traded blue-chip U.S. common stocks. The S&P 500 is a market-cap weighted index composed of the common stocks of 500 leading companies in leading industries of the U.S. economy. The NASDAQ Composite Index is a market-value weighted index of all common stocks listed on the NASDAQ stock exchange. Market indices listed are unmanaged and are not available for direct investment. Past performance is no guarantee of future results.


Now that the numbers are out of the way

Let me first say I hope this update finds you and your loved ones healthy and the only ailments you are suffering from stem from being all cooped up inside.  Who knows what will materialize once these crazy times subside, but I do know that in moments like these it is good to take a pause and remember what is most important to you and refocus on those people, places or things.  When we next chat, let’s make sure and talk about those “re-discovered” important items and make sure we’ve got a plan for taking care of those goals.

Also worth talking about is the recently passed CARES Act and how that may affect you.  One of the better summaries I have found is from T. Rowe Price:

Also, for those with investments that don't do this automatically, now might be a good time to look at a rebalance of your portfolio depending on your circumstances.

For the Logan’s, we’ve been fortunate so far as to remain in good health in our immediate families, and both Lesley and I are working from home.  That may sound like a piece of cake to some but as many parents of small children know that when daycare closes, major adjustments ensue!  Lesley and I do a nice job working around each other’s must do’s each day and watch the girls when the other is busy.  At least nap times are dually productive and we do have limited help from the family coming over a couple times a week.  That said, I have discovered that my initial quarantine habit of relaxing once they were down for the night has been replaced with a couple late nights a week at the computer to catch up and stay on top of things.

It’s important to find some positives in any situation and one for me is that I’m enjoying the extra time with the family.  The girls don’t have any idea what’s going on of course and though their daily whines/screams test my patience at times their daily smiles help keep me grounded.  Lenny is getting quicker at crawling everyday and Aggie has her first tooth and we swear by the recent change in her mood that she hates daycare, so we’ll see how it goes when it opens back up and we can confirm or refute that theory. 

We’re getting used to hanging out with friends and family virtually, I’m getting outside at least once a day for walks with the girls – boy the weather has been great around here lately! - and I’ve been hitting our Peloton up an extra time per week to keep the blood flowing.  We even piled the girls and dog into the van and took a counter-clockwise tour of (mostly) Dauphin county for something to do this past Saturday that didn’t run the risk of person to person contact.  The things we’ll do to get out of the routine.  What’s the strangest normally boring/ordinary task you’ve done just to “do something”?

Side note:  you all know how much of a numbers guy I am so if you’re a fellow Peloton subscriber, follow me -  kpeatcart - and I’ll try to beat all your stats!  😊

Also, I miss baseball (playing and watching).  And soccer.  And college playoff basketball.  And playoff hockey.  Alas, I have dusted off the old Nintendo collection to help fill the void in the evenings while "on the clock" aka on call if the girls wake up.

From the business process perspective we do have some challenges, but we have work-arounds in place.  Claudia is working at home and though our offices in Mechanicsburg and Selinsgrove are closed, but we do have one staff member working in each building alone to keep business going and we coordinate drop-offs and pickups accordingly.  I’ve noticed a few other issues, like delivery (FedEx/UPS/USPS) service delays and staffing levels at a few of our independent business partners but for the most part it’s pretty much business as usual (if you don’t count the market swings).

On an exciting note, I anticipate bringing on my second consecutive summer intern on May 1st.  He is a student at Susquehanna University.  Initially I’ll have him doing some product/investment research for me.  If all goes well with that I may be able to bring another investment option to clients come fall.  The product is available now but previously I haven’t figured out how to balance working with clients and simultaneously researching the wide range of investment options in this product.  So my intern will do the up front research and help me design an efficient way of staying on top of the investment options.  Hopefully I’ll have more on that by the fall.

Lastly, if you haven’t heard from me directly for a check-in yet I apologize for that.  I've called many of you and many of you have reached out to me but I haven't talked with everybody since the market drop gained steam.  If there is something on your mind please do not hesitate to call.  While the necessary tasks of the day seem to take up a majority of my time I will surely work later into the evening to get those tasks done if it means addressing your concern(s).

Remember we’re all in this together and things will get back to normal eventually.  Stay positive.  Test negative.



This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events or a guarantee of future results. The information is based on data gathered from what we believe are reliable sources. It is not guaranteed by LPL Financial as to the accuracy and is not intended to be used as the basis for any investment decisions. The information presented does not constitute a solicitation for the purchase or sale of any security and is not a recommendation of any kind. Keep in mind that rebalancing may have tax consequences and transaction costs associated with this strategy. Please consult with your tax advisor regarding your personal situation.