Texas Presbyterian Foundation

Change, Volatility, & Extraordinary Circumstances: 3 Things You Need to Know Now About Our Financial Markets

By John Furlow, TPF’s Executive Vice President

I think we can all agree that 2020 has been an unprecedented year for a variety of reasons. Covid-19, economic upheaval, social unrest, and trade wars are only a few happenings that impact our financial markets daily. In an effort to uncover exactly what is happening and how it impacts our investments, I hosted a webinar, “THE WORD ON THE STREET, August 2020: A Mid-Year Conversation on Investment Philosophy, Performance, & Perspective” recently with Kris Katarski, our partner from Segal Marco Advisors. Together, we looked at what exactly has happened over the first seven months of 2020 and examined what we all might be able to expect from the markets in the future.

Click here to view this informational webinar at any time.

While we had an informative conversation that included a vast amount of information, the following three points serve as the key takeaways from this educational event:

  1. Planning and structure are critical to the successful growth of your investments. Volatile times like these only highlight the overwhelming importance of well documented Investment Policy Statements, Asset Allocation Guidelines, and a stated Spend Policy. This type of structure provides an extensive amount of stability that is especially helpful in this turbulent environment. TPF regularly works with organizations’ leadership to write, review, and institute these policies and guidelines that will enable the group to accomplish their mission.
  2. Keep calm and stay strategic. Investors who stayed strategic through 2020 and avoided emotional asset allocation decisions were rewarded in the second quarter of 2020. If these investors had pulled their investments after or during the tumultuous end of the first quarter, the results would be drastically different. There are times when strategic adjustments should be made, such as a change in mission or need of additional funds, but leaders must avoid decisions based solely on emotion. With the present volatility and instability in the financial markets, prudent and strategic investing is paramount.
  3. The future looks volatile. These are uncertain times with many questions being unanswered, including: Will we have a Covid-19 vaccine before 2021? Who will be our next president? Will the United States and China reach a trade agreement? The combination of these looming concerns and the knowledge that this year will offer continual surprises, leads us to anticipate that this volatility will continue throughout the rest of this year and into 2021.

These are simply three highlights from a much larger conversation. If you would like to learn more, I would like to invite you to CLICK HERE to register and watch our webinar, “THE WORD ON THE STREET, August 2020: A Mid-Year Conversation on Investment Philosophy, Performance, & Perspective.” This on demand event provides more extensive insight into the highs and lows of TPF fund performance over the past seven months, along with an overview of the anticipated financial environment in the coming months. It is just one more chance to add some clarity in this deeply muddled environment.