Are you ready for what happens next in the markets?


Hi. I’m Dave Shepherd with Shepherd Wealth and Retirement.

Today, you will earn a simpler, more convenient way to think about and understand what’s going on in the markets.

When you go to the doctor’s office or emergency room, what is one of the first things they do? They check your vital signs, right? They know by checking your vital signs of pulse, temperature, respiratory rate, and blood pressure, they will gather a lot of information quickly about your current health and assess if you are in a health crisis–having a heart attack, for example.

I mentioned in our last video that, based on our indicators, we have moved some of our investment positions from risk assets to more stable assets.

Our indicators are like those vital signs. Just like that, we monitor market trends for our clients every day. When the trend is up, we want to be fully invested, knowing that vital signs are strong.

But when one or more of the vital signs of the markets are trending down, it is just like falling blood pressure and an erratic heart rate. Something could be wrong or seriously wrong.

So when appropriate, it’s best to take precaution and check it out fully.

Most times, events where we take action will be minor, easily and quickly resolved. Sometimes, though, it could be a bigger problem that is going to get worse, and without doing something about it, could cause a lot of losses or pain when it comes to your wealth.

The question or comment we’ve gotten from several people because of the action we’ve taken is, your prediction is the markets will drop a lot. I want to clarify that today.

Nothing we do, based on our mathematical, statistical process, is predictive in nature. But just like a doctor, we know the most damage to your health occurs when the vital signs are not strong and showing a potential for a problem that needs attention.

We’re always thinking about two things when managing portfolios, and you should too.

First, you want to stay in areas of strong vital signs and away from the weak areas.

Second, if the majority of all vital signs are weak, move to areas of stability.

Many people believe in the buy-and-hold philosophy that no matter what the market is doing, you hold on, bear the pain of losses, and everything will be all right in the long run.

To us, it doesn’t make sense to see a vital sign of market health declining, like falling price trends, and do nothing about it. After all, you’re 10 years older than the last time the markets had a big decline.

You have less time to get your money back. If you’re retired and taking out income while your investments are falling, or making no money, your plans for the future could be permanently damaged.

To us, it just doesn’t make sense when something is small to take action, like getting a diagnosis early, so it doesn’t cause more problems.

Sure, it may be a false alarm, and when the markets gets back to being better, your money goes back to work. But if this is the big one, it doesn’t make sense to let it hurt your financial health and do nothing.

I’ve had a couple times in my life where I had chest pain, and I went and had it checked out. First time was playing college basketball at 20, and a couple times since.

Every time, it was nothing related to my heart, but related to the muscles in my chest. I just had a follow-up stress test from an event from two years ago that proved to be nothing but maybe too much caffeine before a 25-mile bike ride.

I’m cautious because I don’t want to be that person who thinks everything’s OK–it’s OK– then, like a friend of mine, who walked 10 miles a day, just not wake up in the morning. Or like another friend that, at age 59, died three weeks after retirement.

When is the last time you had a stress test on your portfolio that hasn’t really needed one in 10 years now?

Is this another one of those times when markets are good, where everybody feels like everything’s OK?

You know, it’s not going to do that again. Things are different now. We’ve always got a reason, right?

We can show you what to monitor for vital signs in your portfolio, how to monitor them in your portfolio, so you’ll be better prepared with a plan of action if the vital signs deteriorate. But also, you will know how to recognize when the vital signs are strong, and maybe you could worry a little bit less.

Give us a call today if you want a second opinion to know what your portfolio vital signs could be telling you.

Thank you.

About Dave Shepherd, ChFC, CFP®

Dave is the founder of Shepherd Wealth & Retirement in Tucson, Arizona. Dave is a Chartered Financial Consultant (ChFC) and Certified Financial Planner™ practitioner (CFP®). Have a financial question? Click Here to contact Dave Shepherd.

Investment advice offered through Shepherd Wealth Group, a Registered Investment Adviser doing business as Shepherd Wealth & Retirement.

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