In the last six months of 2018, the S&P 500 of the Dow Jones dropped about 20%. And since Christmas Eve, which marked the bottom of the drop, the market has rebounded most of its losses. So the question people are asking is: What do we do now?

The temptation is to exit and get out now that prices have come back to even, or in some cases, are higher. 

Don’t.  

Our firm embraces financial science, and we know that the stocks we own have an expected rate of return — every day.  We ignored the noise, the prognosticators (entertainers who want our money in their own pockets), and the advertisers. 

We know the market is a discounting mechanism that aggregates all of the information known about a stock. Undeterred, we continue on our predetermined path, with allocation towards global equities and fixed income. 

Take-away: The movement of the market does not dictate how we invest our money. Emotions can only hijack the process; we need to keep them in check. The market will always have price fluctuations (volatility), and we accept that — knowing that there will be bumps in the road along our journey to financial success. It’s part of investing. Onward!

Jeff Holland | VIAIV