11 River Basin Lane, North Yarmouth, Maine 04097 United States
tel: 207-846-8787
toll free: 855-440-0010

Preston Galarneau
Deborah Galarneau

  • Realistic Financial Planning
  • Risk Managed Investing
  • Integrity And Outstanding Service
  • Sleep Better At Night



  Domestic markets hit new highs in mid-February, and on February 13th Bloomberg reported China already had 59,804 cases of COVID-19 as of February 12th. Bloomberg also reported the same day that 15 cases of COVID-19 had been confirmed in the United States[1]. By early April Hopkins University reported 347,000 confirmed cases in the U.S., and over 1.3 million cases worldwide[2].

  Franklin Templeton’s, Darren Doughty, publishes a weekly report on the markets titled, “What Happened Last Week,” and we have frequently cited statistics from these reports in past newsletters. Below are the week ending and year-to-date figures for major equity and bond indexes for the weeks ending March 13, March 20, March 27 and April 6, 2020[3]:            


WKEND 03/13

YTD/ WKEND 03/20

YTD/ WKEND 03/27

YTD / WKEND 04/03


S&P 500   


















Foreign Stocks






Emerg’g Markets






10-yr Treasuries






U.S. Bond






Global Bnd













Looking back at the 4 week period, we can see the path was marked by unprecedented volatility, a drop in equities across the board well within the parameters of a Bear market signal, taking place within a breathtakingly short period of time, and the signs in recent days that we may be making a bottom, or coming close to it. As we write this, we had a significantly down day Friday, April 3rd, followed by a significantly up day Monday, April 6th, and we are just holding on to a small gain in the Dow, S&P, and NASDAQ as we head to the close, Tuesday, April 7th. On the bond side, the pressure to raise cash , and the unwinding of positions in hedge funds, helped create a negative bond market, in which assets you would normally expect to gain in value as the equity markets went down, were in the red themselves. Steps taken by the Fed in recent weeks to provide a stable market for bonds have paid off in recent weeks. Munis had a particularly unusual rollercoaster ride in weeks ending the 20th and 27th. We are watching for opportunities to buy investment grade munis as there still appears to be extra value in some issues.

  We have spent most of our time in the last several weeks reviewing holdings in, and pricing, our model portfolios nearly every day. In times like these, having the discipline to stay with our strategy is vital. We have worked over the past several months to bolster our portfolios with increased cash and fixed income positions and those steps have proven valuable. Our primary goal is to limit the downside in times like these, while maintaining exposure to the equity markets and accumulate cash, which we can spend when the time comes to survey the path behind us and look for opportunities to rebuild. As likely negative impacts from the virus became visible, we have made decisions to sell positions we’d earlier thought should be held. Our trading activity in March was about 5-fold our normal activity. We believe that playing a strong defense during extreme volatility is important.

  At the same time, we have been making lists of stocks we would like to buy once we see enough confirmation to get our feet wet. In recent days, we have made a few purchases. Our strategy emphasizes discipline and patience in making both sell and buy decisions. When we begin to move some offense onto the field, we will be cautious, preferring to miss some of the early market recovery in order to avoid losses which could come from being too eager. That said, we all are looking forward to the recovery we know is coming, in the markets, in the state of business in America, and in day to day life connecting with one another without social distancing. 

  Katie has set up a fully equipped office at her home and we operate from both locations. In her spare time, she wears her teacher’s hat, helping her daughter with remote classroom activities. Preston and Debbie are in the office in North Yarmouth on our regular schedules. We are fortunate that technology allows us to continue our business, doing all the things necessary to manage our clients’ portfolios without missing a beat. We have enjoyed talking with you by phone, having in depth conference calls, and getting creative about completing documents while maintaining a safe environment for our clients. Please don’t hesitate to call us any time!

  We would like to close with a quote from Grant Bowers, VP Portfolio Manager and Research Analyst at Franklin Equity Group[4]:

Given the market environment, it is important to reiterate that corrections have been a routine occurrence throughout financial market history. These periods of market volatility and economic uncertainty are challenging to navigate as investors; but frequently have presented excellent investment opportunities for active managers with a careful eye toward risk management.

We are blessed to have you as clients. We think of you often, and hope that you are staying safe, finding ways to get outside and enjoy the spring and getting a sound sleep at night. Better days ARE coming!



Preston, Debbie, and Katie





[1] Bloomberg.com/coronavirus

[2] jhu.edu/2020/coronavirus

[3] S&P 500 source; S7P 500 index; DJIA source; Dow Jones Industrial Average; NASDAQ source; NASDAQ Composite Index; Foreign Stocks source MSCI EAFE Index; Emerging Markets source; MSCI Emerging Markets Index; 10 yr. Treasury source; MacroBond 10 yr. Treasury Index; U.S. Bond source; Bloomberg  Barclays U.S. Aggregate Index; Global Bonds source; Bloomberg Barclays Global Aggregate Index; Munis source;  Bloomberg Barclay’s Municipal Bond Index

[4] franklintempleton.com, 3/20/20 commentary 

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