TAKE A DEEP BREATH & KEEP PERSPECTIVE
With all of the media coverage in the last week regarding the market, we wanted to share some thoughts.
We just recently ended one of the least volatile years in 60-plus years. Now 2018 seems to be reverting to normal. The fluctuation in stock market points in the last week have been big, but the percentages really are not.
With current market values, a 1,000 point loss is a 4% drop. While this is still a big loss in one day, it’s been our experience in observing the markets that 1-3% moves seem to be about the norm. So, 4% isn’t far off from that. Keep in mind the actual number of points will get larger by default as the Dow Jones Industrial numbers continue to climb. The media loves big numbers that scare people. It creates headlines and gets clicks and buzz.
It’s also worth noting that just because we have volatility, it doesn’t mean we will have a bad year. Take a look at the chart below (click on it to view larger). You can see the yearly volatility and the return for each year (in blue). Earnings and the economy are all that matter – so far so good on both of those.
We urge you to hang in there, take a deep breath and keep this perspective in mind. Of course if you have any questions at all, please feel free to reach out to us. We are here for you.
This information is for illustrative purposes only. Past performance is no guarantee of future results. You cannot invest directly in an index.
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