December 2018, interrupting the soon-to-be longest bull market in history, investors are increasingly. But so many storylines around coronavirus and the election caused distraction.” Birk says his investment recommendations for 2021 are the same as they were for 2020, and the same they’ll be next year: Understand your goals and situation, have a long term plan, and ignore the distractions. After equity markets corrected between October and. ![]() In reality, the market didn’t change much, and the average investor’s big picture goals didn’t change. “There were a lot of stories this past year that were hard to understand. Personal Capital’s Chief Investment Officer, Craig Birk says if we learned anything from 2020, we learned why it’s so important to have a long term plan and stay the course. But with each crash, the market recovers, generating an average yearly growth rate of approximately 10% throughout it’s history. Most recent, the Great Recession of 2008 caused the Dow Jones to lose 50% of it’s value. Schwab Intelligent Portfolios diversifies across stocks, bonds, commodities and cash to help moderate overall portfolio volatility and drawdowns when the. The chief equity strategist shared why it's time to put new money to work after the market. The market lost 22.6% of it’s value in one day on the Black Monday crash of October 1987. Wells Fargo's Chris Harvey predicted a 10 market drawdown amid more frequent pullbacks this year. The Dow Jones dropped 24.8% during the The Great Depression (1929). While maybe not to the extent of 2020, stock market crashes happen on a fairly regular basis. Then at the end of the year even more uncertainty and panic arose, fueled by a contentious presidential election. In 2020, panic stemmed from uncertainty about the coronavirus and economy. The economy is a major factor, but panic plays just as equal a role in stock market volatility. While there was (and still continues to be) a very real economic, financial and health crisis globally, market fluctuations aren’t based solely on economic factors. The Dow Jones gained 6.6%, S&P 500 gained 15.6% and the Dow Jones was up an astonishing 43.7%. The latest South African equity market drawdown using daily data actually started after a daily high on 25 January 2018 (using monthly data, this was December 2017), and it reached a low on 19 March 2020 (due to Covid-19), almost 26 months later. With everything that happened in 2020, by the end of the year the stock market still grew. ![]() By November 2020, US markets finally returned to January levels with the Dow passing 30,000 for the first time in history on Nov. By August 17th, the S&P 500 was up 27% from it’s low, setting new records again. ![]() Cautiously optimistic, investors began to wade back into the market, quickly swimming out deeper.
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