Volatility is never comfortable, and this latest round is no exception. Panicked headlines may have investors feeling apprehensive and uncertain. This has been the worst start to a year for the S&P 500 in the last 25 years. However, we’ve seen this happen time and again. Market pullbacks and corrections are necessary to sustain a healthy market and that, over time, the market has experienced positive growth.
“The first two years of a bull market tend to lead to investor complacency as returns are robust and broad-based,” said Raymond James Chief Investment Officer Larry Adam. “The third year tends to be different and defined by more volatility, muted returns and the need to be more selective. While this downside volatility may seem extreme, it is worth noting that it really is an ‘average’ pullback.”
Having concerns when volatility affects your portfolio is normal. This is why we emphasize the importance of a tailored financial plan focused on long-term financial goals. Over time, dips such as these should feel like mere bumps in the road.
Here are some key facts investors can bear in mind amid volatility:
- Fundamentals continue to support a move higher for equities
- Bond yields have created opportunities for income-oriented investors
- Downside volatility may seem extreme, but in perspective is actually average
As your advisory team, we’re here to provide you not only with insight but with advice on how we can help manage the effects of – and capitalize upon – the markets’ movements. We are watching the markets closely and will reach out should anything require immediate action. In the meantime, please feel free to get in touch if you’d like additional perspective or guidance.
As always, we thank you for the trust you place in us.
The Gratz Park Private Wealth Team