Another Wild Ride
Wow, what a wild week this has been in the stock market. The stock market has climbed 15% this week as of 11:34 am and we saw one of the 4th largest increase in a single day on Tuesday this week with the markets climbing over 11%.
A large part of what drove these gains was the anticipation and now the culmination of the government passing a $2 Trillion stimulus package to help businesses and the economy recover. If you are a business owner or curious how this stimulus package could benefit you give us a call we would be happy to walk you through what you should be doing.
When I talk about a wild ride, here is what I mean. 2 of the top 10 largest daily declines in history happened THIS month on 3/16 and 3/12 with the stock market dropping 12% and 10% respectively. Also of note 2 of the top 11 increases of all time happened THIS month as well. 3/24 and 3/13 with the stock market rising 11% and 9% respectively. While It’s unnerving for all of us when prices change so quickly It’s also important to stay grounded and to not panic. The extreme nature of the daily changes is confirmation that the stock market works and is extremely efficient at setting prices.
LARGEST DAILY % MOVES IN THE STOCK MARKET
One of the reasons we talk about a lot about patience is that missing a couple of days performance can have a lasting impact on your portfolio. While we would all like to move to the sidelines to avoid the worst days in the market there is no proven way to do this effectively. History argues for staying put through good times and bad. Our goal is to structure your portfolio in such a way that takes into account your spending and other needs so that you can be patient through the times of extreme volatility. There are certain fundamental things you should do when it comes to investing and rest assured we will take care of the technical aspects to make sure you get the most out of your portfolio. For you the investor however the best thing you can do is be patient. The adage that it’s Time in the market vs. Timing the Market is and always will be the best course of action.
