Dear Valued Client,
As we shared with you a few weeks ago, we began reducing stock exposure in client portfolios throughout July. This move was a tactical decision, based on our expectation of seasonal weakness that often occurs as we move into the Fall months.
Now that we’re in August, we anticipate more market volatility and wouldn’t be surprised to see a bumpy road for stocks through the rest of the third quarter. After such a strong and steady rebound since April, any pullbacks may feel more unsettling than they truly are. We encourage you to keep these market movements in perspective.
It’s important to note that we are not seeing any signs of a recession. Our decision to reduce stock exposure is short-term and strategic, not a reflection of deeper economic concerns. In fact, we believe that once this period of volatility passes, stocks are likely to continue their upward trend.
We remain confident in the strength of the U.S. economy. Despite ongoing discussions around tariffs and interest rate policy from the Federal Reserve, the key fundamentals—corporate profits, productivity, and consumer spending—are strong. This creates a healthy backdrop for long-term stock market growth.
Some investors have expressed concern about higher interest rates. However, we see today’s rates as a sign of an economy that has healed from the deflationary years that followed the Great Financial Crisis. In other words, this is a sign of progress.
Looking ahead, we continue to believe that Artificial Intelligence (AI) will play a transformational role in the market—much like the Internet did in the 1990s. Just as there were skeptics back then, we expect doubts to surface during this new era as well. Still, we believe investors who stay committed to this long-term opportunity will be rewarded.
While there will come a time to take a more cautious stance on stocks, we don’t believe that time is now. Our outlook remains positive, and we are carefully managing portfolios with both near-term caution and long-term conviction in mind.
As always, thank you for your continued trust. Please reach out if you have any questions or would like to discuss your portfolio in more detail.
Warm regards,
Kessler Investment Group, LLC
All information in this presentation is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. All economic performance data is historical and not indicative of future results. The market indices discussed are unmanaged. Investors cannot invest in unmanaged indices. Certain statements contained within are forward looking statements including, but not limited to, statements that are predictions of or indicate future events, trends, plans or objectives. Undue reliance should not be placed on such statements because, by their nature, they are subject to known and unknown risks and uncertainties. Please consult your adviser for further information.
Opinions shared in this presentation are not intended to provide specific advice and should not be construed as recommendations for any individual. Please remember that investment decisions should be based on an individual’s goals, time horizon, and tolerance for risk.