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Dispersion in the Markets

By LouAnn Schulfer,  AWMA®, AIF®
Accredited Wealth Management Advisor®
Accredited Investment Fiduciary

Here’s one you can add to the multiple ways to finish the sentence “2020 has been the year of _____”:  dispersion in the markets.

The economy and financial markets are made of up many different sectors.  In stock market language, this includes small caps, large caps, technology, emerging markets, consumer discretionary, materials, energy, financials….  The list goes on.  Sometimes, there is little difference in the performance of one sector to the next:  they are either all going up, or all going down.  But other times, there can be significant differences in the performance of one sector compared to another.  For example, as of market close on 10/23/2020, had you positioned your 2020 investments to the energy sector, you would be down over -47%.    Conversely, had you positioned your funds to the NASDAQ index, which is largely made up of technology stocks, you’d be up 43%.  A 90% difference between the two is quite a dispersion!

Diversification is a fundamental tenet of investing, in other words, you shouldn’t put all of your eggs in one basket, or dollars into one investment. However, you may wish to employ a strategy that actively monitors and manages your investments, particularly in times where there is dispersion in the markets.

LouAnn Schulfer is co-owner of Schulfer & Associates, LLC Wealth Management and can be reached at (715) 343-9600 or

Securities and advisory services offered through LPL Financial,a Registered Investment Advisor.  Member FINRA/SIPC.
Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.

All investing involves risk including loss of principal. No strategy assures success or protects against loss. There is no guarantee that a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk.