Over the last few years, there have been more and more articles surrounding the topic…
We want to let you know we are watching with great interest what is happening in Japan. As most of you know we look at this potentially catastrophic event as if the glass is “half full” not half empty! We look at almost all of these types of events as opportunities.
History shows that when extraneous events occur that fuel either the fear or greed component, and the market is fairly valued before the occurrence, the market will rebound fairly quickly. After the October 19, 1987 stock market crisis, the stock market was back to its “pre-crash” level within 12 months. Following our own September 11, 2001 (9/11) crisis, the stock market took just one month to reach its pre-event level.
We are looking at selling some U.S. debt (up 0.25% the last week) and buying some international debt (down 1.5% the last week). Another opportunity is to sell the Janus Forty fund on a bounce in the next few weeks and buy a fund we believe can capture more of the upside in the market after the fear goes away.
For the time being, we need to be patient and get a better idea on how this catastrophe will actually play out. Once we have a clearer picture of the downside risk, we will be taking advantage of the opportunity to buy low because of the fear of the unknown!
If you have any questions at all please do not hesitate to call!
Have a great day!
Bob and the All Star Team