I came into the Wealth Management industry at an interesting time. It was December 2015 and I had just left public accounting to join Platania Financial.
I spent my first year learning the business - studying for my securities and CFP® exams, observing how our firm cares for clients, and encountering different financial situations from clients nearing retirement and those already retired. But the most impactful learning experience came in November, 2016. Our office got a lot of calls that month about the obvious. From "Should I be changing my investment portfolio ahead of the election?" to "My candidate didn't win and I'm nervous, can we move to cash?", we heard it all. A few clients were convinced they needed to do something to take back control admidst the uncertainty.
Fast forward to well after the 2016 election. What happened? Market performance was strong for the remainder of 2016. Investment returns in 2017 were even better, with the S&P 500 (including dividends) up around 20%. All this despite many smart and well-respected strategists predicting the exact opposite.
The stock market is extremely hard to predict based off elections. My takeaway from 2016 is that the world doesn't usually unfold the way you think it will. It's human nature to want to do something and make a decision, like drastically changing your portfolio. But far too often, you're better off doing nothing and sticking to your plan. That's a decision too.
