It has been a busy hurricane season the past few years. After Hurricane Katrina and now with Hurricane Rita, I have received a few calls from clients concerned about their investments. The media is our worst enemy sometimes because they do not always show all sides of the story.
Investment portfolio diversification is the key to withstanding the national emergencies we face now and in the future.
As we witnessed with each national emergency of the past five years, the economy did not come to a standstill. Yes, there will be short-term blips that may spark a slowing of the economy, but history has shown that the economy is actually stronger 6 to 12 months after a large national event.
Hurricanes Katrina and Rita will produce jobs, and many financial benefits associated with rebuilding the hurricane stricken areas. Economists have already reported that the economy will probably slow down for the remainder of 2005, but they predict that it will begin to pick up as soon as the first quarter of 2006.
Because you have a diversified investment portfolio, your investments will be buffered in the short term and still be in play when the long-term benefits kick in.
Hold true to your investment allocation.