Baseball and Investing: Managing Behavior for Success
Money is emotional and our “news” cycle is a catalyst. Investors react to what they hear and how they feel, oftentimes to their own detriment.
Money is emotional and our “news” cycle is a catalyst. Investors react to what they hear and how they feel, oftentimes to their own detriment.
For anyone invested right now, it feels like we’re sinking. But just as boats have lifejackets to keep you afloat, your financial life should have its own lifejackets in place to help keep you from sinking in bear market times like these.
Housing affordability is trending in the wrong direction. Take a look at our chart of the month showing housing affordability over the last 50 years.
"Why would anyone buy a 5-year bond at 3.5% when you could get a 1-year bond at 4%?"
"Why don't I put all my money in a 4-month T-bill and make 4.9%?"
Trying to time the market and choosing to sell in reaction to headlines tends to be a predictable mistake. There always seems to be a reason to sell.
The housing market has been hot since the start of the COVID-19 pandemic. Prices have soared and the interest rate to borrow money for those homes has been at historically low levels. But what is happening now?
Increasing interest rates have many effects, not only on the economy, but also on stocks. Given the recent rally, we wanted to highlight that rising rates do not always mean that stocks will go down. While the stock market is not making new all-time highs just yet, the market has been resilient to a regime thought to be a drag on the markets.
Those of you who keep up with the financial news are likely familiar with the three most quoted indices, the S&P 500, Dow Jones Industrial Average, and the NASDAQ. Sometimes, the returns for all of them are similar, but sometimes they are not.
This year, we have seen a runup in several large names, mostly in the technology space. They have been dubbed the “Magnificent Seven” by financial news publications. Why might this matter to an investor?
Market declines are never enjoyable in the moment. But these kinds of intra-year pull backs are normal when looking at market history.
Recently, a client asked me about sectors. What are they? And how do they fit into a portfolio?