Business Update:

Michael Smith, MSPFP, MBA, CFP®, AWMA®, CRPC® joins D3 Financial Counselors.  Michael joins us with over 10 years of experience in financial planning with T. Rowe Price and Fifth Third Private Bank. Michael will be calling you in March to introduce himself.  His focus will be on financial planning.

Family Office Clients, please turn in your tax information: We encourage all of our family office clients to turn in your tax information to D3 as soon as possible, even if you don’t have your Fidelity 1099.  We can prepare your returns and retrieve the Fidelity 1099s later. Please load the tax documents onto your client portal. Call Patty or Isabelle with any questions.

As a reminder, Fidelity will be changing money market funds:  To comply with SEC rule changes for money market funds, all clients owning the Fidelity Municipal Money Market Fund (FTEXX), as their cash sweep vehicle, will automatically be transferred to the Fidelity Taxable Money Market Fund (FDRXX) in early March. The primary reason for the change is preserve the $1 net asset value for funds being deposited or withdrawn from the portfolio.

Market Insight:

We have repeated January’s summary because it still rings true.

“If you haven’t noticed, we have moved from a low volatility environment (through August of last year) to a high volatility environment. We will likely be in this environment until oil prices have bottomed and investors have more confidence in China’s economic situation.  This is a traders market that is not focused on economic fundamentals and is focused on making money on price swings.  

The economic fundamentals are that in the U.S., employment is strong and the economy is chugging along. In Europe, the economies are growing slowly and the European Central Bank is in a pro-growth mode. The Japanese central bank is also in a pro-growth mode.  All the fear revolves around China and energy producing dependent countries (as well as energy related companies in the U.S.).  So strap on your seatbelt as we anticipate increased volatility over the upcoming months (both up and down).”

Slow economic growth is the curse affecting the stock market, but is benefitting the bond market.   Low oil prices are the curse of the high yield bond market, but should be benefitting consumers. U.S. Politics is a curse affecting foreign confidence, but should be benefitting comedians.

Investment Strategy:  

We reduced risk in our asset allocations in January. We have tried to align your portfolios with your risk tolerance and the level of risk you need to take to achieve the goals in your financial plan. Our objective is to make sure your portfolios can handle the anticipated volatility.

If your cash flow needs for the next year have changed, please let us know.  If you are concerned about this market volatility’s impact on your financial plan, please give us a call.   

Final Thoughts:

Thank you for letting us serve your financial planning and investment management needs.  We are always honored if you refer your friends or relatives who could benefit from our services.