The world has gotten some very welcome news lately: Two Covid-19 vaccines, one made by Moderna and another by Pfizer and BioNTech, have proven to be nearly 95% effective in blocking the virus. High-priority groups could start receiving the vaccine by the end of December, according to U.S. health officials.

So while it's likely to be a difficult winter, there's a light at the end of the tunnel for our public health crisis. But what does that news mean for your investments? If you've loaded up on stay-at-home stocks—such as e-commerce, teleconferencing and streaming entertainment companies—it may be time to consider taking some profits and redeploying the capital into stocks that have been hurt by Covid.

Vaccines aside, recent developments are promising for the stock market in general. The election earlier this month is likely to result in divided government, with Democrats controlling the House of Representatives and presidency, and --barring an upset in two elections in Georgia in January—Republicans holding the Senate. This sort of division of power in Washington, in which neither party can easily pass sweeping legislation, has historically been best for stocks.

In addition, Washington still appears likely to pass another round of economic stimulus within the next few months. That would give consumers and businesses a needed boost as the pandemic continues to drag on the economy.

Stay-at-home stocks, from Amazon to Zoom, tanked right after Pfizer's vaccine news broke, and again after the Moderna news. But investors should avoid dumping this category of stocks wholesale. Valuation is key: If they've gotten ahead of themselves, consider lessening your exposure, especially because it's likely that volatility lies ahead. Also take into account the companies' underlying strengths. Players like Facebook, Microsoft and Apple are sitting on hordes of cash that they can deploy anytime. While they may lose momentum in the short-term, they're still good long-term investments.

Meanwhile, it's worth looking carefully at stocks that have been beaten down by Covid, including those in the travel and tourism, leisure, and hotel industries. Once the severity and depth of the pandemic became apparent, investors fled these companies on fears that many would not survive. But the past two weeks' vaccine news signals that life may begin to return to normal within six or nine months. Companies that can hold out until then could be bargains right now based on rebounding future revenues.

The best way to identify promising companies is by looking closely at not only their potential revenue growth, but also other factors like their debt level, their current stock price and their competition in the market. Please don't hesitate to call us if you'd like to schedule a review of your investments.

The news that President Trump tested positive for the coronavirus rippled through Wall Street and the country on Friday, and it left investors wondering how the development would impact their portfolios.

I believe the most important takeaway is this: The news underscores the fact that the pandemic is going strong. If even the president of the United States can be infected, then we are far from being out of the woods. And I believe that has two implications for the stock market.

First, so-called stay-at-home stocks should benefit. The president's positive test underscores that we're dealing with a highly contagious airborne disease, and with the timeline of a vaccine unclear, social distancing will remain a key line of defense. A widely predicted second wave of infections in the fall would only strengthen the case for social distancing, while sending many students and workers home.

What kinds of companies might thrive in this stay-at-home world? The kind that we at Copeland Wealth Management have been gravitating to for most of the year: technology firms, with an emphasis on those that specialize in connectivity, cloud storage and virtual connection. Retailers including the big-box home improvement chains are also well positioned as stuck-at-home consumers look to feather their nests.

The president's diagnosis may also improve the odds that we get a second round of stimulus relief from Congress. Politically, it's suddenly become much harder to ignore the impact of the virus and the need to respond.

On the other side of this coin, I would warn investors about falling into value traps. Stocks in the restaurant and hospitality, airline and cruise industries are really attractive in many cases. But these companies tend to be loaded with debt, and their revenue prospects are dim. With health restrictions such as limited capacity in place, it's hard to see how they can generate the sales that would translate into attractive earnings.

Remember, not only is it unclear when we will have a vaccine, it's also uncertain how effective it will be, how quickly it will be distributed, and what percentage of people will take it. Consumers have been frightened for a long time, and even after airlines, cruise lines, restaurants and stores open at full capacity, there's no telling how long it will take regular people to start patronizing them at pre-pandemic levels.

In September, we saw investors start to sell stay-at-home stocks, which had become expensive, and move toward undervalued stocks. President Trump's diagnosis is likely to reverse that trend. Please don't hesitate to contact us If you'd like to discuss building an investment portfolio for the pandemic era.

The 2020 elections are just about two months away, and if the 2016 contest taught us anything, it's that predictions are a fool's game.

But for now, the polls are showing that a Democratic sweep – where they retake the White House and Senate while keeping control of the House of Representatives — is at least a possibility.

So investors should be aware of what could be in store under a Democratic government. In particular, tax reform is a major part of Democratic presidential nominee Joe Biden's plans. And one of his most ambitious proposals involves raising the long-term capital gains tax rate for households earning capital gains above $1 million per year.

Long-term capital gains — the sale proceeds from stocks, bonds, mutual funds, real estate and other investments that are owned for more than a year — are taxed at a special rate. For married couples with total income above $80,000 and below $496,600, the current rate is 15%. For couples with income above that level, the rate is 20%.

Biden's plan calls for increasing capital gains rates to the same rate as ordinary income for households with income above $1 million. Those households' capital gains rate would rise from 20% to 39.6%.

Remember that Democrats would need a clean sweep in the November elections to implement Biden's plans. Whether that will happen is unknowable. The important thing for investors is to plan for the possibility. Should power change hands in Washington, steps such as selling highly appreciated shares might be appropriate.

It's also quite possible that we will end up with divided government, where neither Democrats nor Republicans control all three branches of government. In that scenario, we'd likely see the status quo prevail, with neither party able to pass new significant tax changes into law.

In addition to increasing capital gains taxes, Biden would target the top 1% of earners, with a higher income-tax rate. Specifically, taxes on ordinary income above $400,000 would return to the Obama-era 39.6% rate, which was lowered to 37% early in Donald Trump's presidency. Biden has also proposed an increase in the payroll tax to income above $400,000, in order to shore up the Social Security system.

President Trump has been more vague about his tax agenda for a second term; he's spoken about keeping more of workers' pay in their pockets, for instance. But he hasn't offered the level of detail that Biden has.

As a financial advisor, it's not my place to tell you who to vote for. But I am advising my clients to be prepared for the different eventualities that could lie ahead, and to be prepared to make money moves to suit your situation. If you'd like to discuss your investments, please don't hesitate to reach out to us.

November's elections are less than four months away, and if history is any guide, many investors will experience growing anxiety between now and then.

At the root of that anxiety is uncertainty about whether or not control of the presidency, and perhaps Congress, will change hands. Such a change could trigger policy and legislative changes impacting the economy—or more specifically, certain sectors of the economy.

Facing this uncertainty, some investors will be tempted to move to the sidelines until after the votes have been counted and the future seems more clear. I'd caution folks about taking that approach because it could cost you gains.

Historically, broad stock markets are generally flat in the year of an election cycle, although actively managed portfolios have the potential to beat markets. In the year after the opposition party wins the presidency, markets tend to rise—and they rise a bit more sharply when the incumbent party remains in power. (Bonds, by the way, tend to slightly outperform after elections no matter which party takes office.)

So which sectors are most sensitive to the results of this year's elections? Two that could be impacted are healthcare and energy. President Trump has been supportive of the fossil fuel industry, and has sought to chip away at Obamacare. A President Biden would presumably put pressure on both areas.

But the stock market is constantly uncovering and interpreting forward-looking information, and thus it's continually re-pricing stocks. Whatever Washington does to impact healthcare, energy and other sectors, the market will largely have priced it in by the time it happens.

Furthermore, neither presidential candidate will be able to make sweeping changes unless they control the presidency, the Senate and the House of Representative. And markets are not currently pointing to such a scenario.

My advice to investors is to be cognizant of the election news, and understand which sectors might be affected by the election results, but don't overreact. Make sure that your portfolio is properly allocated—that you own the right balance of different sectors, and that your risk is in line with your goals and risk tolerance. If it's costing you sleep, you may want to shift from riskier assets into more defensive ones.

The bottom line is that selling out or making impulsive moves—perhaps influenced by your politics—is not in the best interest of your portfolio. Please don't hesitate to contact me if you'd like to review your investments.

The stock market has had an astounding run over the past three months, or it had anyway, until the June 11 correction interrupted it. Even in the midst of the market's sharp selloff, the S&P 500 index of blue-chip stocks remained 35% above its March low. The tech-heavy Nasdaq was up 39%.

The fact is that the stocks that have led the recovery are still expensive and have little near-term upside. That's why I believe it's time to raise cash and look for companies that offer immense value, but that the market has left behind.

The bull market that followed the mid-March lows has been led by big companies in tech, communications and healthcare – sectors that were seen as good bets during a time of uncertainty. But having piled in and driven up prices, investors had already started rotating out prior to June 11.

The reason for the rotation is simple: With the market-leading sectors having grown prohibitively expensive, investors want alternatives with the potential for greater price appreciation. I agree that a lot of the big names out there are way too expensive right now. Zoom, the videoconferencing company, is up over 200%. Facebook is up more than 50% since mid-March. AstraZeneca, which is working on a Covid-19 vaccine, is up 34% from its March lows.

I have begun paring back winners and raising cash in accounts with low cash levels, which I'll use as buying opportunities arise.

The auto industry looks interesting right now – and I don't mean Tesla, whose sky-high shares are up 126% this year. Traditional automakers like Ford, whose stock has lost a third of its value since January, are worth checking out as the economy continues to reopen and stir-crazy families start to take trips. Note that Americans will be more likely to drive than to fly, given continuing concerns about being around strangers in enclosed spaces.

Certain energy companies are also interesting now that oil prices have rebounded to near $40 per barrel from negative valuations. Higher oil prices allow oil producers to pay their debt stay in business and make a profit.

I'd even look at airlines here, not as long-term investments but as short-term, opportunistic plays. Southwest Airlines stock, for example, has lost more almost 40% of its value since February. As Americans gradually begin to fly again, it and other airlines should be able to cut their losses and begin to recover – especially domestic travel-focused carriers like Southwest. But airlines' fortunes are particularly vulnerable to coronavirus news because their business model consists of jamming people together in closed-off spaces.

Indeed, the ongoing pandemic remains the greatest risk to the economy. Market watchers are hopeful that states can reopen safely, but are looking warily at a surge of new cases in several states.

The bottom line: The market has begun rotating out of the big, growth-oriented companies that led the way after the March lows. This is a good time to raise cash and pivot to selected, lower-priced stocks that could get a lift from the nascent economic recovery and the tailwind of market rotation.

Because the economy and the markets remain touch and go, and it's important to really do your homework before investing. Please give us a call if you'd like to discuss your investments.