Silicon Valley Bank Update
At Correct Capital Wealth Management, we understand that trust and transparency are paramount when it comes to your savings and investments. This is especially true in times of greater uncertainty. The recent default of Silicon Valley Bank (ticker SIVB) has understandably caused concerned for many. As your trusted financial advisors, we would like to provide some additional peace of mind and perspective on SIVB's default:
- Correct Capital Wealth Management (CCWM) portfolios do not have any direct exposure or investment in SIVB.
- All cash reserves maintained at CCWM are held directly with our custodians: Fidelity or Charles Schwab.
- In both cases, we have selected a money market fund that primarily invests in cash or very short-term (7-day weighted average duration) government fixed-income securities worth over $200 Billion.
- Fidelity & Schwab have a $500,000 coverage limit for covered money market funds if they default for any reason.
- Failure of SIVB is not likely a systemic issue, but mismanagement by the executives of SIVB.
- CCWM's managed models are underweight in the financial sector.
- CCWM's stock models only own one regional bank, Cincinnati Financial Corp (CINF), which has a well-diversified portfolio and healthy cash reserves in case there is a run on the bank.
- CCWM will continue to monitor the banking system's health as a whole and keep our valued clients informed if things change.
- Here is an article about the SIVB collapse written by the Capital Group explaining what is going on in more detail.
As always, we're here to help and to act in your best interest. Your satisfaction is very important to all of us at CCWM. If you have any additional questions or concerns, please do not hesitate to contact us at 314-930-4015 or through our website.
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The opinions expressed in this program are for general informational purposes only and are not intended to provide specific advice or recommendations for any individual or on any specific security. It is only intended to provide education about the financial industry. To determine which investments may be appropriate for you, consult your financial advisor prior to investing. As always please remember investing involves risk and possible loss of principal capital; please seek advice from a licensed professional.
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