After the leap came the run. Stocks furthered a surge from the March trough, at one point gaining enough ground (in the States, at least), to turn green for the year. But the recovery in stocks was hobbled by the reality of a virus that very quickly took advantage of loosening restrictions on public gatherings. […]
The U.S. equity market rests just under 8% from its February 19 peak. Cue worries that we’ve come too far, too fast. Near-term stock valuations may look extended as revenue and earnings sink. There’s no end yet in sight for the pandemic, and U.S. elections are just around the corner. But, as the bulk of […]
Podcast: Play in new window
Among the equity market themes one learns early on is that market history is not prologue: past performance is not indicative of the future. We learn, too that market performance is not always positive. Another important premise is that diversification is your friend. These themes apply to the relative performance of the groups of stocks […]
Podcast: Play in new window
Value stocks have underperformed their Growth peers by a gap never wider in history, leaving some to suggest it’s time to throw in the towel. But history shows that when the performance on a long-held strategy is at its relative worst, generally speaking, it’s best to stay true to your defined approach. More than hope […]
Podcast: Play in new window
The first quarter of 2020—and hopefully only the first quarter—will go down in history as among the more chaotic periods of investable market activity. Though markets may be recovering, they likely will remain volatile as new data clarify the macroeconomic effects of the coronavirus outbreak and the supply tensions/demand drop-off in energy markets. That likely means recession or worse for perhaps part of Q1, most or all of Q2 and potentially beyond. This latest episode of market tumult is another stark example of the market’s ability to amp anxiety, even as we can recognize the events of the first quarter as echoes of similarly turbulent periods in history. We otherwise will seek to remain focused on stabilizing investment paths that route to longer-term financial outcomes.
Download PDF: Q120 SAM Market Review
Through the end of March in a pretty remarkable turn of trends, the domestic equity market rebounded 15% over the course of six trading days after the Federal Reserve let loose a rainbow of market support mechanisms and the U.S. Congress passed legislation worth more than $2 trillion in budgeted relief for U.S. businesses and workers. With peak-COVID in the U.S. likely still in the future, and with the macroeconomic impact still only very vaguely estimable, it’s easy to think up reasons to believe the rebound has gotten a bit ahead of the fundamentals. Even so, with the market still well off its February peak, we think history will show that patience amidst heightened volatility was rewarded over time.
Download PDF: 0420 SAM Commentary
In the following video, Mark seeks to provide additional perspective regarding recent market volatility. Importantly, this video is not presented as an investment recommendation. The approach described may not be right for everyone. No one watching or listening to this video should take our comments as advice specific to or appropriate for their individual situation. […]
After the day before turning in its fifth-worst day in history—its worst single-day performance in more than three decades—on Friday the S&P 500 turned around to record its tenth-best daily return in history. That it ended on a strongly positive note may have been little relief for the anxious, as the index remains down just under 20% from its February record peak. The two-way volatility we saw last week offered a strong reminder that remaining invested during times of market tumult generally has proved the better course for those with reasonably long investment time horizons.
Download PDF: 20200315 SAM Market Update
As markets roil, it’s increasingly evident that the eventual depth of this downturn will depend on the breadth and duration of the dual contagions now spreading across the globe: the coronavirus outbreak and the oil price war. With the actual disease threatening human life and macroeconomic growth, potential duress in the energy sector threatens to jump from oil companies into the financial sector and beyond. Headlong into the market plunge, we sought some perspective—and even some reassurance—from history. Though we find a wide range of durations for past market drawdowns, just as obvious from the data is the fact that, in its having reached another peak just a few weeks ago, the equity market eventually recovered from every prior drawdown.
Download PDF: 20200311 SAM Market Update
