Despite downturn, Delaware advisers remain bullish on stock market

Key Advisors Group Managing Partner Doug Ferris monitors the stock market inside his Dover office early Monday afternoon. (Delaware State News/Craig Anderson)

DOVER — Local financial advisers weren’t selling stocks on a turbulent Monday.

Actually, they were buying them at deeply discounted prices.

No panic resulted as continuing coronavirus concerns and plunging oil prices staggered Wall Street with a one-two punch.

The Dow Jones Industrial Average briefly shed more than 2,000 points and trading was stopped for 15 minutes as the market cratered.

For at least four Dover area wealth managers, the widespread selloffs provided tremendous opportunity to buy in.

BIG President David Boothe saw some level of crash coming six weeks ago as the coronavirus spread overseas.

“I’m frankly shocked that it took this long for the markets to catch up to that,” he said.

A few weeks ago, Mr. Boothe raised extra cash and invested more aggressively into stocks when the negative impact reached here.

“Without mentioning specifics, but just as an example, there were a couple solid tech companies that were being sold off but reported good quarters,” Mr. Boothe said.

“I’m not going to go dumpster diving, I’m not going after cruise lines, but on a day like (Monday), I can’t just sit on the sidelines and let these bargains pass by.”

Recalling his 22 years as a wealth manager La Mar Gunn of Gunn Wealth Management said current conditions presented probably “the best time I’ve ever experienced when it comes to being a buyer.”

Said Edward Jones financial adviser Joanna Daneman, “We’ve been here before and while we shouldn’t dismiss this pullback, it also creates opportunities.

“Corrections are always unsettling and we have short memories, which may bring a touch of fear in the moment.

“The headlines are changing, the markets are changing but your long-term perspective and goals shouldn’t change. We’ve always stressed having a balanced portfolio and that continues to be our message.”

Near the end of last week, Key Advisors Group Managing Partner Doug Ferris and team members contacted clients and reassured them about remaining steady in turbulent times. Of up to 300 or so clients, just one was too spooked to remain in stocks.

“It’s extremely important not to make knee-jerk reactions, which is something a novice investor might do,” Mr. Ferris said. “The mistake is getting out early because you’ll never make that back when or if you decide to get back in.

“The economy is still somewhat strong and can weather a lot of the negative factors currently in play. I don’t think this is a scenario that we experienced in 2008 when there were other issues quite unlike the ones we have now.”

Mr. Ferris described clients as emotionally “grounded. They are in a good place.”

Ups and downs

There’s enough uncertainty about the coronavirus to assure Wall Street ups and downs moving forward.

“With the virus, nobody knows if they’ll get a handle on it a month from now or six months from now,” Mr. Ferris said. “The situation will probably remain volatile for the next couple months because the market doesn’t like the unknown.”

Good companies are now available at a great price, Mr. Gunn said. Older clients may benefit with the opportunity to buy into previously unattainable stocks.

“I would encourage retirees not to make hurried decisions,” he said. “If they’ve made mistakes in the past, this is a good time to grab premium names at a huge discount.”

Acknowledging that there’s no way to guarantee future returns, advisers remain bullish on long-term market prospects.

“Over the next four months, the market will rally and then re-test the lows,” Mr. Boothe said. “A recession is possible but the market will figure that out and turn upward before we realize we were ever in one.”

Said Mr. Gunn, “I don’t have a crystal ball but every time I’ve gotten an opportunity to buy a great company at a great price, I’ve jumped in and my clients are happy,

“Some of the newer ones may need a bit of reassurance but the ones I’ve had for 20-plus years are rock solid and excited for the chance to invest in some great stocks.

“There are a lot of really good companies that pay good dividends that are under pressure.”

Helpful Coronavirus links

Delaware Division of Health Coronavirus Page
CDC: About the Coronavirus Disease 2019
CDC: What to do if You Are Sick
Johns Hopkins Coronavirus Resource Center
AP News Coronavirus Coverage
Reopening Delaware: Resources for Businesses
Delaware Phase 2 guidance

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