It's different this time. How many times have you heard that phrase during market downturns or volatility? It's easy to get sucked into the attention grabbing headlines. Although declining oil prices, issues in China, and the Federal Reserve increasing interest rates are real factors in the recent extreme volatility in the stock market, on the flip side, improved unemployment rates, cheaper gas, and stronger U.S. Consumers are factors that aren't grabbing the headlines. Why would that be? Unfortunately, those kind of headlines don't grab the same attention and ratings that the media is looking for.
That being said, we don't presume to know how the markets will perform for any certain time period. We can't predict how far the markets will go down and when they will recover, nor can anyone else. What we do know and can predict is the markets are volatile and they will go down, and they will go up. It is our job to plan for what we know.
We believe with a disciplined globally diversified investment plan, you will see long term growth in your investments over time. Taking advantage of market volatility by rebalancing, selling the stronger performing asset classes and buying the asset classes that are selling at a discount, is one strategy we use to try to enhance performance, without predicting its direction.
Below is a reminder of the past 45 years of attention grabbing headlines:
As you can see, even with negative events happening regularly over the past 45 years, over time there is growth for us to capture. The key is to have an investment plan and don't react to today's headlines and stay disciplined. If you would like to discuss your personal investment strategy in more detail, we are happy to do that with you.