Dear clients,
Looking back over the last three years feels pretty good for most investors. Much of the stock market has performed admirably! Even with a couple of good-sized corrections, most folks are downright pleased with their outcomes.
But there is a good reason that cars have smaller rear-view mirrors than windshields – the important things to manage are more likely in front of us than behind us.
No doubt there is plenty of chaos and the headlines are scary right now with the Iran war. Even before that, the market had smaller rolling corrections in some tech and AI sectors. Now many of the year’s early gains (January and February) are gone, and with oil prices much higher, we find ourselves more keenly aware that future returns seem harder to predict in the shorter term.
The core question investors need to answer going forward is whether the events in front of us will fundamentally – and for a sustained period – systemically change the economy. (Spoiler alert – it’s too soon to know.)
So, what do practiced investors do during times like these? Times where doing something might be just as detrimental to success as doing nothing? Our experience has taught us we have to be responsibly positioned before the chaos begins. It’s why we rarely chase fads or trends. It’s why we value diversification and are more interested in long-term stability and lower volatility than capturing all of any one market rally.
We will continue to diligently evaluate events around the world. Keep in mind, volatility and corrections are part of the investment experience. An average is always made up of a mix of good and bad. If you want to know more about how our process can help navigate times like these – let us help!
Sincerely, John