Stock market returns for the last month have been on the rise. But will the markets keep rising?
Investment prognosticators are once again lining up with their opinions. Some say it is time for an adjustment. Some claim there is money to be made. Others claim there will be only modest gains with another correction coming soon. And here you are … stuck in the middle of them all!
Over the last year, we faced dramatically falling oil prices, China’s economic slowdown, and uncertainty about U.S. interest rates. The Fed’s December decision to institute the first short-term rate increase in nearly a decade removed some of that effect. In addition, perhaps lesser but still significant issues were Greece’s continued debt crisis, Mideast tensions, terrorist attacks, and fears of further slowdown in the emerging markets.
Of course throughout the year, people felt uncertainty and fear. Yet in spite of these headwinds, the market has been rising again recently.
You know, if this was the first time this happened, that would be one thing. But we face market predictions every year, with little correlation between the consensus of predictions and what actually happens. Have you stopped to think how ridiculous this behavior is?
Martin Weisberg, my colleague and friend, with more than 40 years of experience in finance, says “The market does not care what you or I think about it.” And that, my friends, is the absolute truth. A successful long-term investment experience is not the result of predicting the market, but the result of a disciplined, diversified, risk-appropriate investment strategy that you continue no matter what happens.
Does this sound too simple? The Chinese philosopher Confucius once said, “Life is very simple, but we insist on making it complicated.” You could say the same thing about investing.
For more insight, listen to Jentner Wealth Management’s weekly podcast by clicking here. Or download Jentner’s white papers on The Four Cornerstones of Prudent Investing and The Active Versus Passive Investing Debate.