This week, we've finally seen the stock market to recover a bit.
As we start to approach the midterm elections, our view is that the stock market volatility that we've seen lately may begin to subside. This may set up some calmer waters to re-enter the market.
We continue to maintain our view that the stock market now is at some pretty deep discounts and it's a great opportunity to re-enter the market with some excess cash.
Additionally, jobs data for the month of October came out stronger than expected, which is further proving our view that the economy is pretty strong at the moment.
The information provided should not be relied upon as investment advice or recommendations, does not constitute a solicitation to buy or sell securities and should not be considered specific legal, investment or tax advice. The information provided does not take into account the specific objectives, financial situation or particular needs of any specific person. Diversification does not ensure a profit or protect against a loss in a declining market. There is no guarantee that any particular asset allocation or mix of funds will meet your investment objectives or provide you with a given level of income. Forecasts or projections of investment outcomes in investment plans are estimates only, based upon numerous assumptions about future capital markets returns and economic factors. As estimates, they are imprecise and hypothetical in nature, do not reflect actual investment results, and are not guarantees of future results. Investing entails risk including the possible loss of principal and there is no assurance that the investment will provide positive performance over any period of time. The stock market is in reference to the S&P 500 index. Volatility is in reference to the CBOE VIX index. An index is unmanaged, does not reflect management or trading fees, and one cannot invest directly in an index. The stock market recovery was in reference to the S&P 500 for the time period 10/26/2018 market close to 11/2/2018 market close and was gathered from the SPX ticker from Bloomberg Terminal. The midterm election volatility statement was in reference to Goldman Sachs' Market Know-How Edition 3 analysis titled "Election Pop and Volatility Drop." Their disclosure for this data is as follows: "Source: GSAM. As of August 2018. S&P 500 Average Return is the path of the S&P 500 Index before and after historical midterm elections (i.e. the midterm elections are the starting point of the analysis to determine the average pre- and post-election S&P 500 path), using the averages of weekly returns in order to generate that path. The midterm elections analyzed were: 1994, 1998, 2002, 2006, 2010, and 2014. Average VIX refers to the average weekly absolute value of the CBOE Volatility Index (VIX) to generate a path before and after those same midterm elections. The analysis uses S&P 500 and VIX data from May 27, 1994 to April 24, 2015. For example, the S&P 500 average return four weeks before the midterm elections was 5.2% lower than that of the midterm week. The average VIX level four weeks before the midterm elections was 24.0. Past performance does not guarantee future results, which may vary." The jobs data release for October was referenced from the Bloomberg article "U.S. Payrolls Rise More Than Forecast as Wage Gains Hit 3.1%" by Katia Dmitrieva. Nonfarm payrolls rose 250,000 which was higher than the median estimate of 200,000.