First, we’d like to start off by paying a brief tribute to Senator John McCain. He served our country as a legendary war hero and lawmaker who pushed for bipartisan agreements to make our country a better place, and we as Americans are grateful for his service.
As you well know, McCain’s passing is not the only sad or concerning news on TV from recent weeks. If you are a regular reader of our “Off the Wall” Blog, the mantras “stick to your plan” and “keep looking forward” will sound familiar to you. There is a reason we consistently emphasize these phrases.
Headlines in the news often tell one story, yet after some initial volatility, the performance of the stock market often tells another. August has been a great reminder of why sticking to your plan and continuing to look forward are so important.
Let’s review some of the major headlines over the last month:
“Sentiment Unsettled by Latest Trade War Threats” – Nasdaq, August 1, 2018
“Oil Prices Plunge as Stockpiles Jump” – Wall Street Journal, August 8, 2018
“Turkey Tantrum? Investors Fret Over Contagion from Lira Plunge” – Reuters, August 15, 2018
“Investors Watching US Yield Curve and No-Brexit Deal Risk” – Financial Times, August 26, 2018
If you never checked the balance of your accounts and instead only focused on the headlines, you might guess that markets in August were volatile and experienced a sell-off. Trade tensions with China continue to be a concern. Sanctions on Turkey and a flattening yield curve have also given many pundits plenty of ammunition to speak to current risks in the market.
Now compare the headlines and fear that the news generates to what is actually happening in the market. As of this blog post, the S&P 500 is making a new all-time high. That’s right, in the face of all the risks we hear about in the news, the market continues to move higher.
Like everyone else, we have no crystal ball and could not have predicted the rocky ride we’ve experienced from the beginning of the year to today. Yet, we find ourselves at new highs and are reminded why we don’t react so quickly to headline risk.
At Monument, we know from our collective experience that there will always be reasons for concern. As a Team, we continue to monitor those risks and adjust our stock market exposures accordingly. But staying the course and remaining true to your long-term plan is much likelier to lead to success than trying to navigate every risk we read about.
As we look back on the first 8 months of 2018, we are reminded of why it’s so important to tune out the noise, continue to stick to your plan, and keep looking forward.
Keep looking forward, Dave! You’ve almost made it.
On a side note, we’d also like to extend Dave’s own advice to him as he finishes up the last leg of his Pacific Crest Trail hike. He’s got just over a week left to go. This past weekend, he and his group hiked up 3,000 feet over Seldon Pass, and although we give this photo credit to another hiker, Dave’s view must have looked something like this:
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Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Monument Wealth Management), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. All indexes referenced are unmanaged and cannot be invested into directly. The economic forecasts set forth may not develop as predicted. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from Monument Wealth Management. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. Monument Wealth Management is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice. A copy of Monument Wealth Management’s current written disclosure statement discussing our advisory services and fees is available for review upon request.