Thriving in a Post-COVID World

“A year ago, the World suddenly stopped as we were hit by a global pandemic of epic proportion. Investors worried about their health and whether they would have enough money to weather the storm. They worried about their loved ones, jobs, and businesses.”

There were a few historical comparisons; the Spanish Flu (1918-1920), Asian Flu (1957-1958), AIDS (1981-present), Swine Flu (2009-2010), and Ebola (2014-2016). We also struggled to understand the global impact and how it would change our lives. We wanted answers! How can we slow the spread of the virus? How long would it last? When can we expect vaccines?

Beyond the health issues, investors were seeking guidance about the markets and their portfolios. Wealth advisors needed to pivot quickly from dealing with a robust economy, to an economy intentionally put to sleep to save lives; and they had to deal with unprecedented market volatility, and uncertainty about when the markets would stabilize. The precipitous declines in February and March were very troubling for investors, and no doubt many considered heading for the exits to avoid further losses. Investors heard daily death tolls, saw ravaging images, and saw their wealth plummet. 

During the early days of the pandemic, we experienced 8 of the 10 largest point losses of the Dow Jones Industrial Average (DJIA); which was quickly followed by 8 of 10 the largest point gains as the markets were flooded with fiscal and monetary stimulus. Note, only 2 of the 10 largest percentage losses occurred in 2020. Because the markets were at all-time highs, the point losses and gains exaggerate the overall the percentage moves from lower levels. By comparison, the largest percentage loss occurred on Black Monday, October 19, 1987, where the down fell a then record 508 points (-22.61%).

Dow Jones Industrial Average: Largest Losses of All-Time