It is still hard to be a long-term investor, but….

It is still hard to be a long-term investor, but unless you plan to use your pre-needs plan in the next couple of years, you need to think and plan as a long-term investor. We have clients who jumped out of the market after the December 2018 drop (down over 19%) …and have not returned. The problem with this strategy? The S&P 500 is up over 19% year-to-date, and within 40 points of its all-time high. Those who left the market in December and didn’t return remain with their 19% loss…

Forty years ago, most investors paid little, if any, attention to the market. It was a number on the nightly news, and that was about it. Today, in our smart phone, media deluged lifestyles, some investors are receiving minute-by-minute updates…and suffering the concurrent stress. The pain of losses significantly outweighs the pleasure of gains. We have embedded biases and heuristics that make our brains set our portfolio high mark as “our money” … no matter how much is our contribution, and how much is the markets’. So, when the market starts down, we feel to a much greater degree the pain of loss.

A survey produced by the financial research firm DALBAR suggests that poor timing was a key factor that caused returns for stock mutual fund investors to lag the market by almost 4% during the past two decades. A strategic asset allocation, coupled with tactical tilts and diversification can help mitigate the volatility of the stock market drawdowns…making the probability of an investor’s long-term goals being more achievable, from both a practical and an emotional perspective. We have powerful software and analysis capabilities that do not guaranty any particular outcome, but directionally provide a superior map to achieving your goals.

Call us if we can be of assistance.

Dave + Drew