Here are several highlights from last week’s market activity, as well as developing stories the investment team is following this week. As always, we remain committed to helping you navigate the ever-changing investment environment.
The following highlights should not be viewed as a recommendation, nor is this a notification of an impending change in asset allocation. For more information, please contact your advisor with any questions.
Don't know what to keep and what to shred? Here is a great article on the MWM blog that can help: Keeping Your Financial Records Straight
Long-Term Investing – Part IV
“The market is down, maybe I should sell out now and get back in when it’s going up.” Does this sound familiar. Odds are friends of yours or maybe even you have thought this at some point when the markets were correcting. We refer to this thought process as market timing and it can be a dangerous habit. Sometimes, investors think they can outsmart the market; other times, fear and greed push them to make emotional, rather than logical decisions.
The chart below is a sobering reminder of the potential costs of market timing. By missing some of the market’s best days, investors can lose out on critical opportunities to grow their portfolio, with devastating results. Importantly, as the chart also notes, 6 of the 10 best days occurred within 2 weeks of the 10 worst days. You may get lucky once or twice but over the long term we advocate staying invested and managing volatility, which may result in a better investment outcome.
Next week we will continue our series on long-term investing and will continue to delve into the benefits of diversification and mitigating our emotional biases.
Please do not hesitate to call your advisor if you have any questions. Until we speak again, have a wonderful week.
These highlights should not be viewed as a recommendation, nor is this a notification of an impending change in asset allocation. For more information, please contact your advisor with any questions. Opinions expressed in the attached article are those of Judith McGee and are not necessarily those of Raymond James. All opinions are as of this date and are subject to change without notice.
Securities offered through Raymond James Financial Services, Inc. Member FINRA/SIPC. Investment advisory and financial planning services offered through McGee Wealth Management, Inc. McGee Wealth Management, Inc. is not a registered broker/dealer and is independent of Raymond James financial Services.
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The Russell 2000 Index measures the performance of the 2,000 smallest companies in the Russell 3000 Index, which represent approximately 8% of the total market capitalization of the Russell 3000 Index. The MSCI World Index is a free float-adjusted market capitalization weighted index that is designed to measure the equity market performance of developed markets. As of June 2007 the MSCI World Index consisted of the following 23 developed market country indices: Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Greece, Hong Kong, Ireland, Italy, Japan, Netherlands, New Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland, the United Kingdom, and the United States. The MSCI EAFE (Europe, Australasia, and Far East) is a free float-adjusted market capitalization index that is designed to measure developed market equity performance, excluding the United States & Canada. The EAFE consists of the country indices of 22 developed nations. The MSCI Emerging Markets is designed to measure equity market performance in 25 emerging market indices. The index's three largest industries are materials, energy, and banks. The Nikkei 225 is a stock market index is for the Tokyo Stock Exchange (TSE). It is the most widely quoted average of Japanese equities. The Euro STOXX 50 Index is a market capitalization weighted stock index of 50 large, blue-chip European companies operating within Eurozone nations. The MSCI US REIT Index is a free float-adjusted market capitalization weighted index that is comprised of equity Real Estate Investment Trusts (REITs). The index is based on the MSCI USA Investable Market Index (IMI), its parent index, which captures the large, mid and small cap segments of the USA market. The Alerian MLP Index is a composite of the 50 most prominent energy master limited partnerships calculated by Standard & Poor's using a float-adjusted market capitalization methodology. The index is disseminated by the New York Stock Exchange real-time on a price return basis (NYSE: AMZ). The Barclays Global Aggregate Index is a flagship measure of global investment grade debt from twenty-four local currency markets. Investing in commodities is generally considered speculative because of the significant potential for investment loss. Their markets are likely to be volatile and there may be sharp price fluctuations even during periods when prices overall are rising.
Securities offered through Raymond James Financial Services, Inc., member FINRA/SIPC. Investment advisory services offered through McGee Wealth Management, Inc. McGee Wealth Management, Inc. is not a registered broker/dealer, and is independent of Raymond James Financial Services.
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