The Storm Before the Calm
The stock market has been pretty boring lately…which is a very welcome change after the pain and devastation of the recent correction and immense increase in volatility.
After a meteoric rise last year, we hit a wall in February. We had the best January in over 20 years. Then we got the 5th worst February in the S&P 500’s history. In just 10 trading days stocks lost a whopping 13.3%!
Since then we’ve recovered about half of the drop, doing so in a pretty mundane fashion. This is a good thing. Markets can “Correct” or “Adjust” two ways: Either by going lower or trading in a sideways fashion know as backing-and-filling, until the excesses have worn off.
It looks like we are getting the latter which means the recent pullback and current sideways trading is the storm before the calm and should setting up for a decent market ahead, as long as the economic fundamentals remain strong.
That doesn’t mean it’s going to be easy going, as increased volatility is back with a vengeance, but opportunities are available for those who invest carefully, wisely and of course tactically. The days of buy-and-hold, AKA buy-and-hope are likely behind us.
This is still a very dangerous market, especially for retirees or those getting close, so be an expert or hire one. If you would like to learn more about our disciplined investment and planning approach that manages risk and delivers returns while being conscious of forward-looking tax-strategies, give me a call for a free no obligation consultation today.
Cheers -Keith Springer