​Notes From Nagle 2/7/25

Last Monday, January 27th, we experienced a sharp decline in tech stocks, particularly Nvidia, which suffered the largest single-day market cap loss in the history of the stock market. This dragged down other stocks too – the NASDAQ was down over 3% in 1 day! This sort of market decline challenges us as investors to reflect on our emotional reaction to the drop.  A reaction of fear or panic probably indicates that you have an overexposed and too risky portfolio.
 
I’ve been talking about reducing risk in our portfolios for months. Bull markets tend to breed overconfidence, which, if that happens, can lead to poor investment decisions. Proper portfolio construction is essential for long-term stability and peace of mind, especially in volatile markets, which is where we are now. Peace of mind on your investments is very important because without it even worse investment decisions can follow.
 
If you feel your exposure to equities (stocks) is too high, it might be time to consider working in some protected investments to your portfolio. This could lock in gains you’ve experienced and protect you from downturns that I think are inevitable going forward.
 
Equity Markets have gone up over time. That’s a fact. But they also can be quite volatile at times, leading to big losses. Those losses have proven to be temporary, and that’s great in the long run. But it can take years to get back even, and not all of us have years to recoup losses. That’s why having guaranteed investments as part of your portfolio make sense at all times but especially now. 
 
If you’d like to get another opinion on your investments, feel free to contact me. There is no obligation or cost to simply get an opinion. I’d be happy to do it for you.
 
Peter J Nagle
[email protected]
505-423-5378