Redrick Terry:
It is now time for 4 Your Money. We’re joined by David Nelson, CEO of NelsonCorp Wealth Management. David, welcome back.

David Nelson:
Good morning, Redrick. Thank you.

Redrick Terry:
Thank you. So we’ve talked a lot about technology and how it’s dominated this year. There have been comparisons that have been made to the late 2000s tech bubble. Do you feel like this is the top or do you think there might be more to come?

David Nelson:
Things have certainly gotten ahead of themselves when you look at the economic backdrop. We’re factoring in and weighing in a whole bunch of good news in the future. A lot of people are saying we’re probably in the eighth or ninth inning as far as if we use a baseball analogy. I brought along a chart I wanted to show folks. It’s showing four major bull markets and the final five years of those bull markets, which, having these big type of runs in the last five years is quite common. The current bull market that we’re illustrating here pales in comparison to the top two. The top two lines are looking at the 20s and the 90s. Certainly, there could be more, looking at what took place yesterday as far as with markets, it’s hard to say. We had a rough day, but the bottom line today, companies are making money. The tech companies are making money that’ll push this market higher, unlike the 90s where they weren’t making money.

Redrick Terry:
Of course, we’ve got the economic recession that’s happening right now because of the pandemic. How does that factor in there?

David Nelson:
Unlike the economy slowing things down, this one’s been the government has basically stopped this one. What’s going to be interesting to see as far as the earnings the next year or two, because clearly the markets that look forward, we’re just questioning whether they look forward with too much of an optimistic viewpoint of what’s going to take place.

Redrick Terry:
Let’s talk action plan now. What should people be considering as far as that goes?

David Nelson:
Depending on their individual goals and timelines will really dictate that. Their willingness to accept increased risk, which has certainly increased as far as over the last several months as the markets moved higher. Taking a few chips off the table through rebalancing probably wouldn’t be a bad idea. Again, it’s going to be dependent upon their goals and their timeline, but the rebalancing is certainly something people should be looking at. The final three items would be, as we always talk about, people need to diversify. They should be looking at tactical strategies. In our opinion, they should be hedging their portfolios at this point in time.

Redrick Terry:
David Nelson, as always, good stuff. Thanks for joining us today.

David Nelson:
Thank you, Redrick.

Redrick Terry:
If you missed any part of our discussion, we’ll make it available to you at ourquadcities.com.