We’ve been here before...

Stocks have been sliding for about a week and there is an obvious rotation taking place.  Yesterday’s winners have become today’s trash, as many of the stay-at-home stocks have gotten clobbered.  

Zoom is down 23% from its highs…

Peloton -35%

Shopify -17%

You see the trend here…  

We can only guess what the catalyst is for this move (inflation fears, new administration’s policies, rising bond yields), and perhaps maybe the market simply needs to take a deep breathe. Yet even when the market only dips a little, investors often fear it will become much worse.  We have been here before, and we will be here many more times in the future.  As of this morning, the market is down 4.1% from its peak…only another 30% to go before we match the COVID crash from last year (insert sarcasm).  Losing money is never fun, however it will always be a necessary pain to endure in order to grow your money.

Here is a 5-year chart of the S&P 500…we have seen plenty of dips along the way, yet the market has more than doubled in value.  

Investing never comes with a free lunch.  Enduring volatility is the emotional price we must pay to achieve gains.   Your first line of defense is properly aligning your investments with your risk appetite, which many investors seem to avoid.  

Ready to review your investment strategy?  

‍