Knowing What Not To Do | Financial Perspectives
Stocks are down. Bonds are down. Inflation is up. There is a war in Europe. When nothing feels certain, what should investors do? One of the things we can do is pay attention to something else.
Stocks are down. Bonds are down. Inflation is up. There is a war in Europe. When nothing feels certain, what should investors do? One of the things we can do is pay attention to something else.
For weeks, the major indices had been declining but in mid-March, we saw a very abrupt reversal. I’m often reminded of the familiar saying “Investors must be present to win.” In other words, the price (or cost) of admission to the investment experience is market volatility.
Pictures and video coming from Ukraine are difficult to watch. As humans, we may be angered and ask, “How can I help?” In investing, typically the best thing to do in the moments when we are most tempted to do “something,” is simply to sit still.
How do we deal with uncertainty in a globally connected world? Uncertainty is nothing new. It's an ongoing factor in global markets that can be embraced and often managed in investment portfolios. In this webinar, we will cover: potential impacts of Russia and Ukraine on your portfolio, the ripple effects of the war on inflation, interest rates, oil, and continuing market volatility, thoughts on what you could consider doing now, and updates regarding ongoing developments.
There is just something about the NCAA Men’s and Women’s College Basketball Tournament. There is tremendous excitement in many families and workplaces as tournament brackets are filled in with predictions about the outcomes of 67 games over a three-week period.
Index funds are popular investment tools for good reason. They are low cost, effective ways to capture market return. Choosing to use index funds is only half the battle though; you must use them correctly to truly benefit.
The month of January was marked by negative returns for global stock markets. But, as the well-worn phrase, “Is your glass half full or half empty?” implies, our view of, or the way we feel about the state of markets as investors, may be more related to our personal dispositions than what the numbers indicate.
Market declines are never enjoyable in the moment. But these kinds of intra-year pull backs are normal when looking at market history.
Over the years, Foster Group has utilized a number of mutual funds and exchange traded funds managed by Dimensional Fund Advisors (DFA). DFA was founded in 1981 on the idea of making academic investment research and empirically based portfolio management accessible to investors. In this article, Professor Kenneth French describes how markets responded to the events surrounding the COVID-19 pandemic.
If an investor could discover the true worth of a company, a piece of real estate or even an idea, where “true worth” equated to the future value or price that others would pay, success would be almost certain to follow. Those opportunities that were priced significantly lower than the future value would be automatic buys. The one’s with higher prices today than the future price would be ones to avoid. If only it were that simple!
Investors have been experiencing some fear of heights recently. Many stocks and stock markets are at or near all-time highs. So, here’s the question investors need to ask themselves today, ”Do you think that stock markets 26 years from now will be higher or lower than they are currently, even if today is an all-time high?”
As we’ll see, each of these are real risks, because if they are unmanaged or unanticipated, they may cause investors to focus on the wrong things at the wrong times and lead to actions that may sabotage goals and portfolios.
Don’t believe the lie that you don’t belong or that the keys belong to someone who won’t give them to you.
One of the primary roles we play as financial advisors is to help our clients remember to take the long-view.