This is Critical

This is Critical

March 19, 2020
Share |

Elizabeth Craddock, here at MFG, asked me this afternoon if I had read Dave Armstrong's most recent blog.  We closely follow his thoughts and she knew I would be particularly interested in today’s post.  I beat her to it!

In my mind it properly frames what it means to be an investor … and not a trader.  It speaks to what is important: time in the market is more important than timing the market.

I can’t say it any better than the way Dave shared it, so I am going to paste those thoughts below now….

The majority of your lifetime investment returns will be determined by decisions that take place during a small minority of the time.

Most of those periods come when everything you thought you knew about investing is thrown out the window.

How you invested from 1990 to 1998 wasn’t all that important.  The choices you made from 1999 to 2001 shaped the rest of your investing career.

What you did from September 2008 to March 2009 likely had more impact on your lifetime investment returns than what happened cumulatively from 2002 to 2007, or from 2009 to 2017.

The pilot’s famous answer when asked about his job – “Hours of boredom punctuated by brief moments of terror” – applies perfectly to investing.  The brief moments of terror are the rise and fall of bubbles.

It’s me again. 

Listen carefully!  What you do now will likely shape what the next 10 years will look like for you.  For those of you I’ve spoken with directly, you’ve heard me say this.  For every seller there needs to be a buyer.  Someone must see value in what you currently own if they are willing to buy it.  They know that if they are patient, calm, focused and disciplined, it will increase in value over time.  You know the saying, “buy low, sell high” … not the other way around.  Remember, it is time in the market and not timing the market.

Make sure you have cash on hand and use that to fund expenses – this includes cash flow.  Now is NOT the time to liquidate any securities at current market levels.  Some of you have asked me is this a good time to be opportunistic and buy.  I think NOW is the time to make sure your portfolio is positioned for a future recovery … it is NOT the time to create a portfolio that you wish you had when this all started.  I really believe for long-term investors, a once-in-decade opportunity may be emerging.

This is a face-paced environment.  So, our emails and blogs are the fastest way to communicate with general updates.  If you need anything, please reach out to us.  We are here to help and listen.

Best regards,

 

Jim

The economic forecasts set forth in this material may not develop as predicted and there can be no guarantee that strategies promoted will be successful. All investing involves risk including the loss of principal.