A Time of Opportunities

These days it is difficult to find a place where you are not bombarded with bad news.  The economic crisis is taking its toll on America.  But as John F. Kennedy once said, "In Chinese, the word 'crisis' is composed of two characters—one represents danger and the other represents opportunity."  This recession has presented us with some exceptional opportunities in various asset classes.

One example is real estate properties that are selling at severe discounts.  If you have adequate equity in your home, this may also be a great time to refinance as you can lock in a low interest rate.

Not every investment performed poorly during this recession.  For example, some managed futures funds have had a phenomenal year in 2008.  The Barclay CTA Index (an index that tracks the performance of commodity trading advisors) was up over 14% in 2008. A managed futures manager we use was up 105% in 2008.

This is a time to focus on the opportunities and not a time to let your emotions drive your decisions or to put your head in the sand. As one analyst pointed out, “History shows that periods of turmoil and steep market declines have subsequently proven to be among the best times to invest” (American Funds, Insights, Winter 2009). We see this recession as a tremendous opportunity for the right types of investments.

Note: Past performance does not guarantee future results.