Thursday, November 17, 2016

Time, not timing, is what matters.

When it comes to investing in the market, we believe, it is not the market, but rather time in the market that truly matters. So many investors spend time trying to "guess" what the market is going to do. But any way you slice it, in our experience, timing the market just doesn't work.

Rather, it is our belief that investors who have stayed the course through the long haul - even through periods of declining stock prices - are in a much better place when all is said and done.

For some, this may be extremely difficult to do - especially during times when it appears that the market is in a state of decline. Nobody likes to sit and watch their money "disappear". So it can be tough to stay the course.

But even though selling when there is a sudden downward movement in the market may limit your short-term losses, you may also miss out on an upward swing in the market. According to Market Analysis, Research and Education (MARE) group, a unit of Fidelity Management & Research Co., the investors who sold and remained out of the market (S&P 500 Index) after it fell by 20 percent on October 19, 1987, would have missed out on the 15 percent climb over the following two days.

Likewise, an investor who sold after eight down days in the fall of 2008 would have missed out of the 6th largest one-day gain ever on October 11, when the S&P rose by 12 percent, also stated by MARE. This, too, highlights the importance of investing for the long-term, and not getting caught up in the "hype" of short-term market movements.

All indices are unmanaged and investors cannot actually invest directly into an index. Unlike investments, indices do not incur management fees, charges or expenses. Past performance does not guarantee future results.The S&P 500 Index is a broad-based measurement of changes in the stock market conditions based on the average performance of 500 widely held common stocks.

Wednesday, November 16, 2016

There is Always Scary News

Every time I turn on the TV, it seems as though bad news is flooding the screen. Of course, this news has an effect on the stock market, keeping many investors away. While it may seem like times are tough right now, there has actually always been negativity out in the world, and in turn, reasons to keep your money close. But the truth is, if you stop investing during "bad" times, you will lose out on quality investment opportunities.

Here are just a few examples of what would have occurred in terms of dollar amounts and average total returns if you had invested $10,000 in the (            )  on these historic days:
  • Terrorists attacked the World Trade Center on September 11, 2001. Ten years later, you would have had $12,715 which is a 2.4% return. By the end of 2013, you would have had $21,168 - a 6.3% return. 
  • The Dow Jones Industrial Average dropped a record 22.6 percent in one day on October 18, 1987. Ten years later, you would have had $44,268 which is a 16.0% return. By the  end of 2013, you would have had $137,666 which is a 10.5% return.
  • President Kennedy was assassinated on November 22, 1963. Ten years later, you would have had $22,945 which is an 8.7% return. By the end of 2013, you would have had $2,171,751 which is an 11.3% return.
  • Pearl Harbor was bombed on December 7, 1941. Ten years later, you would have had $34,710 which is a 13.3% return. By the end of 2013, you would have had $37,870,576 which is a 12.1% return.
      Spreading fear is profitable for the 24/7 news channels and is designed to keep you tuned in for more information. Their ongoing, fear-based programming is harmful to you and your investing program. 

[     *Results are calculated by (            )