Save your energy for the battles that matter
You need all of your considerable intellectual and emotional bandwidth to do the work you were meant to do—whether it’s running a successful business or helping kids get to college. Don’t waste a minute of it worrying about your investment portfolio, even when times are turbulent.
Unpredictable doesn’t have to be unnerving
Volatile markets almost always test the nerves of professional investors and money managers, particularly those who rely on mutual funds and lack direct experience in buying and selling stocks, and those who have a singular buy/sell strategy, such as growth or value. If even the professionals can feel a little shaky, it’s no wonder that their clients find it hard to sleep.
We designed an investment strategy to take advantage of volatility
At Two Point Capital Management, we welcome volatile markets, because they are the best time and place to find investment opportunities. In fact, our clients tell us they anticipate the coming of a more active market with some enthusiasm.
Volatility is actually the norm in the stock market, and not the exception. So we’ve spent decades looking for the best ways to maximize opportunities during turbulent times, without taking undue risk. Our strategy is a proprietary, hybrid approach. We call it Value+Quality™ and it makes use of the best features of value investing, growth investing, and what used to be called “blue-chip” investing.
We look for bargains or “value,” but only in companies that we feel are sound, well managed, and poised to grow nicely over the long term. That requires knowing individual companies on an intimate basis. Investment managers who like to make “the big sector calls”—Buy oil! Buy coal! Buy technology!—have a hard time navigating an up-and-down market; its unpredictability works against their strategy.
an up-and-down market; its unpredictability works against their strategy.
Now is not the time to sell. Now is the time to reinvest.
Volatility brings opportunity. It requires more research and harder work, and it might be found in different companies than those whose stock you have held before. You won’t find opportunity everywhere, If you are invested in mutual funds, you may well be over-diversified during a volatile market.