If we hear one more analyst on the financial networks espouse the virtues of a correction the remote might end up being tossed at the television. We all know this is what the majority of analysts believe. We are all aware that 600 Dow points is 2.40% of where this index currently trades and not 10%. Despite being in this business for 30+ years, it’s still never easy to endure these volatile down days. Your pulse quickens, your eyes blur and your stomach rumbles. This is probably a good time to stay calm and focused.
In August of 2015 the market lost approximately 15% of its value and that seemed like the end of the world. It wasn’t. What’s been happening the past several days isn’t the end of the world either, but it sure feels like it. Perhaps we are still battling the ghosts of 2008. If so, that is a mistake.
At Fagan Associates we are viewing the glass as half full. Here’s why: The global economy is solid. Tax reform should help US companies be more profitable. The recent downturn has made valuations more attractive. The market should have solid underpinnings to weather modestly higher interest rates.
These pullbacks are never easy, but now is the time that investors earn those over-sized returns they received in 2017.
Please note that all data is for general information purposes only and not meant as specific recommendations. The opinions of the authors are not a recommendation to buy or sell the stock, bond market or any security contained therein. Securities contain risks and fluctuations in principal will occur. Please research any investment thoroughly prior to committing money or consult with your financial advisor. Please note that Fagan Associates, Inc. or related persons buy or sell for itself securities that it also recommends to clients. Consult with your financial advisor prior to making any changes to your portfolio. To contact Fagan Associates, please call 518-279-1044.