Dear Clients and Friends,

I hope you are enjoying the arrival of spring and most importantly, that you and your family are doing well.

As you know, after the fastest 23 day drop in history, the U.S. stock market has rallied powerfully off the March 23rd bottom. Our stocks held up relatively well during the downturn and are performing superbly in this rally

Overall, we are pleased with the high-quality structure of your portfolio and remain focused solely on your financial well-being.

About two decades ago, I was handed a one-page sheet of paper with the simple headline, “What We Know for Sure.” It gave ten investment principles laid out as a basic framework for achieving successful investment results.

I thought you would find these of interest.

1. Stocks and bonds fluctuate in value.
2. Diversification spreads risk.
3. Successful investors have a long-term perspective.
4. Instant gratification means long-term investment failure.
5. Historically, dividends from a portfolio of successful companies rise long-term.
6. Inflation is a long-term constant.
7. The best investors never forecast short-term.
8. Time is more important than timing in investing.
9. Investors can make money in flat markets.
10. Selling at the bottom and buying at the top is natural for most people.

I have added many more to my list, but I will share just a few that are applicable to the current market situation:

11. Markets go down a lot faster than they go up – which will panic most investors.
12. Each bear market has its unique rationale for decline – leading many frightened investors to exclaim – “This time is different.”
13. The four most dangerous words in investing are: “This time is different.”
14. A well-crafted portfolio of great companies with risings earnings power and dividend streams will produce excellent long-term investment results.

The above represents time-tested principles that guide our investment decisions for you each and every day. You will notice that number seven says: “The best investors never forecast short-term.” Obviously, many investors are wondering if the market bottomed in late March, or if the economy will recover later this year, etc. To this I say, I don’t know what will happen in the short-run, but I do believe that the companies in your portfolio will perform very well indeed over the next three, five, ten years and beyond.

To that point, today marks the 46th anniversary of the founding of J.W. Burns & Company Investment Counsel. My father left the brokerage businesses and founded this firm on May 1, 1974 so he could solely focus on his clients and their financial well-being. And that is exactly what our firm has done over the last 46 years, operating as an independent, fee-only, fiduciary investment advisory firm. I know my father would be very proud of where our firm stands today, and would be focused solely not on the short-term market moves, but on owning great companies, with great managements, with exceptional long-term outlooks.

Attached is a Business Digest cover story from July 1984 on my father and his then ten-year-old investment counseling firm. The title of the article is simple: “An investment counselor in a class by himself.” 36 years later from this article’s publishing, I think we continue to be an investment counseling firm in a class by ourselves, working hard for you, our valued clients, each and every day.

John Burns Business Digest

Thank you for your continued confidence, and have a great weekend.

James C. Burns, CFA
President