INDIVIDU AL


NONPR OFIT n


What a Year It Was A


ssessing probability and predictability (or lack thereof) is an internal part of portfolio management. At the onset of 2016, I doubt that many, if any, predicted


Drew


Kavanaugh, MBA, CFP®, VP Wealth Management


the Chicago Cubs would break the curse to win the World Series and that Donald Trump would be elected our next President in the same year. Both


happened, and the markets responded (maybe not so much to the Cubs winning). Te anticipation of a pro-growth political regime took hold after the presidential election and is not expected to decrease as the new year continues. Now is the time to see if the team assembled by President Trump can produce like the baseball team Teo Epstein, president of baseball operations for the Chicago Cubs, put together in the 2016 season to “Fly the W” of victory.


At the onset of 2016, I doubt


called for another credit crisis and recession; however, a rebound in oil prices pushed the averages back to breakeven by the end of the first quarter. Bonds continued to do well, with the Barclays Aggregate Bond Index up nearly 6%, until the night of the election. Ten, after an initial sell-off, bond yields climbed and bond prices fell. Investors clearly felt the incoming administration would provide better growth opportunities.


that many, if any, predicted the Chicago Cubs


would break the curse to win the World Series and


that Donald Trump would be elected our next President in the same year.


In the first two months of 2016, stock markets got off to their worst start since the Great Depression, falling over 10%, due to precipitate declines in oil prices. Many


As 2016 ended, the S&P 500 closed 11.96 higher, the Aggregate Bond Index closed 2.65 higher, and MSCI ACWI, the broader stock index, closed up 5.63. No one wants to be left behind, but that doesn’t mean you should try to chase better-performing sectors or indices. Maintaining a well-diversified portfolio should pay off in the long run, which is like the farm league system in baseball—investing in the farm league’s young talent parallels diversifying in the underinvested asset classes.


Contemplating the past year and anticipating the new year, Ambassador Advisors will continue to assess probability and predictability of the financial markets and


provide a well-balanced approach for your financial planning. oldsfinancial.ambassadoradvisors.com • 5


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