I’m not the first person to note “markets move quickly,” but it’s a sentiment I share often as a reminder that they do…move….really…quickly. So we need to understand what that means and be prepared for when it happens. We’ve seen the stock market wipe out years of gains in about 5 weeks’ time, but today, we saw nearly a 10% move to the upside from yesterday’s closing price. Let’s put today’s move into perspective: on 3/23/2020 the S&P 500 bottomed at 2,193, today it closed at 2,446; 2,193 was a price we saw around Thanksgiving, 2016; the S&P 500 didn’t close above 2,446 until the beginning of July, 2017 – over six months later!
The S&P 500, today alone returned what six plus months did in 2016 – 17. This is why we don’t market time, and this is why we don’t move to cash. Frankly, we just know we’re not gonna get those moves right, we’re not gonna get out February 21st and get back in yesterday. Had we missed today, that’s an 11.5% return we might not ever get another chance at. Instead, we grit our teeth and stay in, and when the market takes a big dive, we put some money to work, and when it takes a big dive again, we put so more money to work. Maybe we rebound from here and we saw the low of this move, or maybe we make new lows later this week. We just don’t know, and nobody else does. But, in time, the market will rebound, and we’ll be rewarded for it if we stay vigilant and fight through these tough times. Markets move quickly, so we must move quickly with them to the downside in order to move quickly with them to the upside.
The S&P 500, today alone returned what six plus months did in 2016 – 17. This is why we don’t market time, and this is why we don’t move to cash. Frankly, we just know we’re not gonna get those moves right, we’re not gonna get out February 21st and get back in yesterday. Had we missed today, that’s an 11.5% return we might not ever get another chance at. Instead, we grit our teeth and stay in, and when the market takes a big dive, we put some money to work, and when it takes a big dive again, we put so more money to work. Maybe we rebound from here and we saw the low of this move, or maybe we make new lows later this week. We just don’t know, and nobody else does. But, in time, the market will rebound, and we’ll be rewarded for it if we stay vigilant and fight through these tough times. Markets move quickly, so we must move quickly with them to the downside in order to move quickly with them to the upside.
