The Word from Main Street
Market Update for the Week of May 18, 2020
Most of our clients are actively engaged in the Envision® planning process, which helps define lifestyle expectations, life goals, and financial objectives. Once desired goals have been established, the Envision process stress-tests them against historical market simulations to help create a Target Zone. The Target Zone, which is a score (a.k.a. the “dot”) between 75 and 90, helps the Financial Advisor allocate client assets consistent with the investment objective and helps instill client confidence regarding the likelihood of achieving the desired goals. The “dot” represents the value of the assets, both internal and external, that are included in the plan.
Due to severe market movement, there are times when the “Current” investment allocation is different from the “Recommended” investment allocation. This is consistent with our Tactical Tilt methodology, which has the primary objective of pivoting between the pursuit of wealth accumulation strategies (i.e. offense or seeking to maximize gains in your portfolio) and wealth preservation strategies (i.e. defense or seeking to reduce the risk in your portfolio). This temporary difference in investment allocation can cause some confusion with regard to client reporting. The most recent “dot” appears on the graph in direct relation to the “Recommended”, not the “Current” investment allocation. This is due to the fact that the software uses the historical returns of the “Recommended” investment allocation to project future performance. We always advise clients to monitor the “Recommended” score.
If you have any questions about your Envision plan or your score, please reach out to your Financial Advisor. If you have not yet engaged in the Envision process, please consider doing so. By tracking your ongoing investment results against your unique Target Zone rather than the market, you’re in much better position to answer the question, “How am I doing?”
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CAR-0520-02471Wells Fargo Advisors Financial Network did not assist in the preparation of this report, and its accuracy and completeness are not guaranteed. The opinions expressed in this report are those of the author(s) and are not necessarily those of Wells Fargo Advisors Financial Network or its affiliates. The material has been prepared or is distributed solely for information purposes and is not a solicitation or an offer to buy any security or instrument or to participate in any trading strategy.Past performance is no guarantee of future results. All investing involves risk including the loss of principal. Asset allocation and diversification are investment methods used to help manage risk. They do not guarantee investment returns or eliminate risk of loss including in a declining market.Technical analysis is based on the study of historical price movements and past trend patterns. There is no assurance that these movements or trends can or will be duplicated in the future. Nasdaq Dorsey Wright developed the indicators described above. They have been prepared without regard to any particular investor's investment objectives, financial situation and needs. Accordingly, investors should not act on any recommendation (express or implied) or information in this report without obtaining specific advice from their financial advisors and should not rely on information herein as the primary basis for their investment decisions. Any statements nonfactual in nature constitute only current opinions and interpretations of their indicators, which are subject to change without notice. There may be instances when fundamental, technical and quantitative opinions may not be in concert. Any opinions expressed or implied herein are not necessarily the same as those of Wells Fargo Advisors or its affiliates. Any market prices are only indications of market values and are subject to change. The material has been prepared or is distributed solely for informal purposes and is not a solicitation or an offer to buy any security or instrument or to participate in any trading strategy. Data and opinions are current as of 12/16/19. Additional information is available on request. Nasdaq Dorsey Wright’s “DALI" employs relative strength-based analysis to rank macro asset classes based on developing leadership trends within the global capital markets. The objective guidance within DALI provides the tools necessary to properly allocate portfolio across all major asset classes in an effort to emphasize strength wherever it exists. Domestic Equities, International Equities, Commodities, Currencies, Fixed Income and Cash are evaluated daily to identify dynamic developments across investment genres, as well as within them. This tool provides the tactical precision that allows investors to adapt as the market leadership changes.Wells Fargo Advisors Financial Network did not assist in the preparation of this report, and its accuracy and completeness are not guaranteed. The opinions expressed in this report are those of Main Street Wealth Advisors and are not necessarily those of Nasdaq Dorsey Wright, Wells Fargo Advisors Financial Network or its affiliates. The material has been prepared or is distributed solely for information purposes and is not a solicitation or an offer to buy any security or instrument or to participate in any trading strategy. Additional information is available upon request. Investment products and services are offered through Wells Fargo Advisors Financial Network, LLC (WFAFN), Member SIPC. Main Street Wealth Advisors is a separate entity from WFAFN.