The Russian military invasion of Ukraine this week added more uncertainty to capital markets in what has already been a volatile year. Sadly, the death toll continues to rise, and images are already circulating of the destruction that has occurred in just a couple of days. It is sad and frightening to see, and our hearts go out to the people of Ukraine.
While US equity markets were positive on Thursday and look to continue in that direction today, the next few weeks could bring additional volatility depending on the outcomes of this conflict. We currently are not making any trades based on the events in Eastern Europe, but we are monitoring the situation. It is important to keep in mind your long-term goals during these chaotic events, which rarely have a lasting effect on long-term portfolio economics. Actions based on emotions, whether it be fear or greed, are generally what cause the worst financial outcomes.
We will continue to monitor the situation, along with several other factors that may affect the economic and market backdrop for the remainder of 2022. We continue to search for opportunities to reposition portfolios to reduce risk or improve return potential but want to avoid the mismatch of investing for the long-term based on short-term events. See the below table from AllianceBernsten for a list of historical geopolitical events dating back to 1970 and their minimal lasting impact on markets over time.
We pray for those involved in this conflict and hope a resolution can be reached quickly to avoid further loss of life and destruction to the Ukrainian people and their livelihood.
Please reach out to your Advisor with any specific questions you may have on your portfolio or financial plan.
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