The only two facets of uncertainty that we can control are our preparation for it and our reaction to it. Since its founding, CBIS has believed that investment in high-quality, well-established companies with sound balance sheets is the best preparation for economic and financial uncertainty and that sticking to discipline in the face of the unexpected is the best reaction to it. Investors who were so emotionally rattled by the crisis that they strayed from their discipline by moving to cash in early 2009 — when fear was greatest — paid a heavy price by missing out on the year’s surprisingly strong rally. If history is any guide, a crisis of the magnitude we experienced in 2008 is unlikely in the years immediately ahead. And yet, given the many uncertainties facing global economies and markets, there are no guarantees.
During 2009, CBIS worked hard, through diligent outreach by our Investment Advisors and through a steady stream of market commentary, to help participants create and adhere to a sound investment discipline. We believe that the single most constructive response participants can make to the experience of the past two years is a thorough reevaluation of their risk tolerance and asset allocation. As we hope for the best, we are well-advised to plan for the worst by rethinking our understanding of investment risk and by ensuring that our portfolio strategies are founded on a process that guides our reaction during periods of market stress. Your CBIS Advisor can help you reassess your risk tolerance, reshape your investment strategy if need be, and rebalance asset class weightings to better align them with your organization’s investment needs and goals.
Internally at CBIS, we also adhered to a discipline in the face of the year’s uncertainty. Confident that the crisis would eventually pass, that the markets would recover and that our participants’ financial needs will continue to evolve, we determined early in the year, even when markets were at their worst, to strategically look out beyond 2010 and advance several key initiatives that will allow us to better and more comprehensively serve Catholic institutional investors.
CBIS worked hard, through diligent outreach by our Investment Advisors and through a steady stream of market commentary, to help participants create and adhere to a sound investment discipline.