Happy March, friends and clients!
What a difference a few weeks make. We kicked off 2026 with optimism around broader market leadership (small caps and cyclicals stepping up), but the past couple of days brought a sharp reminder: geopolitics can override everything else in the short term.
On a personal note, I just flew our Cessna back from Florida after a wonderful visit with Laura’s parents. The return leg tested me: dodging scattered storms, pushing through mist and low clouds, and even dealing with an unexpected electrical failure mid-flight. It reminded me how even the best-laid plans encounter turbulence—but with solid preparation, quick thinking, and built-in safeguards, you stay on course and reach your destination safely. Markets can feel the same way right now…
Recent days have been a stark reminder of how quickly geopolitics can drive market volatility. Escalating tensions in the Middle East—including U.S. and allied actions against Iran, retaliatory strikes, threats to disrupt key oil shipping routes like the Strait of Hormuz, and signals of a potentially extended conflict—have sent shockwaves through global markets. Oil prices surged sharply (WTI crude climbing significantly, settling in the mid-$70s after sharp intraday gains.), reigniting inflation concerns and pushing longer-term Treasury yields higher (10-year around 4.0-4.1%). The VIX fear gauge jumped notably to multi-month highs, and major U.S. indexes experienced meaningful selling pressure, with intraday declines of 2% or more before paring some losses to close modestly lower overall (roughly 0.8-1.1% down across the Dow, S&P 500, and Nasdaq).
Quick YTD Pulse (through March 3 close):
- S&P 500 now modestly negative YTD after recent pullback (closed ~6,816–6,817, down ~0.9% today; overall flat to -1%ish YTD).
- Small caps (Russell 2000) still holding strong relative gains earlier in the year but gave some back today.
- Energy sector outperforming amid the oil spike; tech and consumer discretionary lagging on risk-off sentiment.
- Precious metals: Had been strong safe-haven plays but saw some retreat today as risk assets sold off broadly.
- Bonds: Yields up as inflation worries trump safe-haven flows for now.
This isn’t the “healthy rotation” we discussed last month—it’s classic geopolitical-driven volatility. Markets hate uncertainty, especially when it threatens energy supplies and global growth. But remember: these shocks, while painful short-term, often create opportunities for prepared investors. Broader bull markets have weathered similar storms before by broadening out and rewarding resilience.
Key Takeaways & Actionable Steps Right Now:
- Hedging is Your Best Friend in Storms Like This: Our “buy and hedge” approach via ZEGA Investments remains a game-changer—seeking to reduce the risk of loss from sudden volatility spikes or unexpected events without minimizing returns. Exciting update: ZEGA recently added two new strategies to their lineup to give investors even more tools!
- ZSTK (Stacked Hedged): This strategy delivers diversified, multi-asset exposure (stacking complementary assets like stocks, gold, and intermediate Treasuries) in a capital-efficient way, aiming for growth with built-in hedging to smooth out bumps. ZSTK Performance Tear Sheet
- ZTAX (Tax Aware Long/Short): A 130/30 tax-aware approach designed to pursue market-participating growth while enhancing after-tax returns through efficient long/short positioning and tax considerations. ZTAX Performance Tear Sheet
- These additions build on ZEGA’s core hedging expertise and could be great fits depending on your goals—especially in uncertain times. If you’d like to learn more about ZSTK, ZTAX, or how they might complement your current setup, just let me know (or reply to this email)—happy to dive in and share details tailored to you.
- Legacy & Tax Planning Amid Uncertainty: With potential inflation/tax implications from energy shocks, spring remains ideal for Roth conversions, trust reviews, beneficiary updates, or charitable strategies to protect and pass on wealth efficiently.
- Upcoming Events: It was great seeing many of you March 3rd at the Long-Term Care Strategies Workshop with Chad Eichorn at Winterset Public Library —perfect timing to discuss safeguarding your assets as we age. Couldn’t make this one? Give me a call or reply to this and I’d be happy to brief you on the great content. And don’t worry, I host quarterly informational workshops every quarter. Stay tuned for next quarter’s announcement.
Looking Ahead: Consensus still points to solid full-year potential (~10%+ S&P gains) if earnings hold and tensions ease, but expect more bumps—upcoming data (payrolls, inflation reads), policy responses, and any de-escalation (or not) in the Middle East will drive swings. The U.S. economy remains resilient, and history shows markets recover from geopolitical flares when fundamentals endure.
Stay disciplined: invest long-term, protect short-term, and turn volatility into your advantage. If recent market moves have you rethinking your plan—or if you’d like a complimentary portfolio review to stress-test against this environment—reply to this email or call me at (515) 462-0020. I’m here for you.
Here’s to navigating 2026’s challenges and coming out stronger—your financial freedom is worth protecting!
Best regards,
Ken Luckinbill
Luckinbill Financial Advisors
Where your Financial Freedom Takes Flight!
P.S. Small moves now (like adding hedging or rebalancing) can deliver big peace of mind when headlines get loud. Let’s chat soon.
Even when markets get bumpy—like dodging storms and glitches mid-flight—a clear view ahead, solid preparation, and built-in safeguards keep us soaring toward our goals. Your financial freedom takes flight!
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