Michael Wursthorn

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1,567 appearances 29 recordings 1 series first heard Jul 2017 last heard Nov 2021

Michael Wursthorn’s voice in public audio — every appearance, attributed to the second.

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WSJ Your Money Briefing · Today's Volatile Market: You Can Run, But You Can't Hide · 1 Nov 2018 podcast

And the hit was so bad that for the year, those investors would be down more than 1%.

And that's only something that's happened three other times, the last time being in 2002, the other two times, 2001 and 1990.

And those were other periods of volatility, but it just shows how rare that a diversified portfolio

can fall as much as it has into negative territory.

So we really are in unusual times.

And it's making a lot of investors anxious.

That's telling portfolio managers, strategists, and other investors that the volatility is just so scary, so off-putting,

that investors are more willing to sit with cash, with something that they just feel is safer, a safer store of their value, than to take a chance by taking advantage of some of these steep pullbacks.

I mean, shares of Amazon, for example, were down more than 20% at one point during this October sell-off, putting it into bear market territory.

But still, I mean, a lot of financial advisors and portfolio managers say,

weren't willing to wade in and buy some of those assets.

So the cash is really a signal that investors just feel that there is no safe place to enter into the market at this point.

So they'd rather just take their chips off the table altogether and just hold on to that cash and hopefully wait for when things calm down a bit.

Gold saw a slight increase, but not enough.

I mean, gold's still down more than 6% for the year.

So the move to gold was very minimal, not enough to offset some of these losses in the portfolio.

And like you said, some of those other assets that are considered more durable, more of a safe haven, like consumer staples, shares of utility companies, both of which pay pretty strong dividends and are pretty crucial to the economy because in the sense that people are going to pay a water bill regardless of what's going on in the economy.

Those stocks saw a slight bump too.

But you're talking about a little more than a 1% gain.

So even in a diversified portfolio, like the example I gave earlier, it wasn't enough to offset the double-digit declines you saw in other sectors, especially technology, which has just been such a frontrunner, such a favorite of investors throughout this long bull market, that it just further supported investors to say maybe,

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