Optimism

Dear Client

It has been one year since the U.S. economy and stock markets began to take their dramatic tumble. Amidst fears of another Great Depression, the Dow Jones Industrial Average hit bottom on March 9, 2009. It has been a time filled with dismay, and we have experienced the full gamut of emotions. However, what happened following March 9 and in the past six months is truly remarkable. As of August 30, 2009, the Dow Jones Industrial Average rose 46 percent from its low in early March, and the NASDAQ Composite Index was up 60 percent.1 Those are exciting numbers. They show that opportunities do in fact lie in the times that follow market downturns, and that these ups and downs are a natural part of market cycles.

At DG Private Wealth Management, we have been sending you letters over the past several months to remind you that the dramatic market events of the preceding year are a part of a process we have seen before. While most of us have never experienced a bear market quite like this one, history shows that market performance is cyclical. Similarly, our emotions cycle up and down. Historically, at some point after feeling defeated by market lows, investors begin to feel encouraged. After March 9, our confidence in the U.S. economy began to rise. Over the past several months, growth has started to show in different segments of the economy. It appears that a new hold is taking place and our country’s confidence and optimism is gaining momentum.

While the markets may or may not test the lows we experienced in March, by "sitting on the sidelines" – meaning leaving investable assets in cash or cash equivalents – investors are assured to miss market growth. By staying invested, you have participated in the growth that has occurred since March 9. When the markets closed on August 31, 2009, it marked the sixth consecutive month that the S&P 500 Index posted a positive return.2 This gives us even more reason to be optimistic about the future.

As we begin to look ahead, remember what’s important to you. Despite all that has happened over the last 12 months, has your reason for investing changed? You have unique goals and aspirations, and your financial portfolio should parallel those objectives. We’ve seen once again that staying invested can help you reach your financial goals over time. <Firm Name> is here to help you make and keep the important promises in your life. Thank you for allowing us to be your partner, and please call us at <(area code) phone number> to schedule a wealth management review today.

Sincerely,

¹ Past performance is no guarantee of future results.

Zuckerman, Gregory. Lessons of the Financial Crisis – One Year Later. Wall Street Journal Online. 30 August 2009. http://online.wsj.com/article/SB125158349559369687.html.

² Standard & Poor’s.