To say the least, there’s been plenty of political, financial, and economic action this year—from rising interest rates, to elevated inflation, to ongoing market turmoil. How will all the excitement translate into annual performance in our investment portfolios? Markets often deliver their best returns just when we’re most discouraged. So, who knows! While we wait to find out, here are five action items worth tending to before 2022 is a wrap.
Our faith in these marvelous markets can be tested when bear markets rage like they have in 2022. It’s natural for our loss aversion tendencies (Investor Behavior Biases) to appear, tempting us to alleviate the uncomfortable feeling.
You may have noticed, the world never stops spinning. The same can be said for evidence-based investing. Even an evidence-based portfolio is expected to evolve over time.
Who are you, and what is your money about? Having described our best practices for identifying quality investments built to last through volatile markets, we arrive at Step Four, which is about identifying solutions that aren’t just ideal in general, but are also expected to be ideal for you.
If you’re seeking clarity, the daily spew of financial commentary won’t help. To cut past the clutter, we’ll revisit our investment selection process over this three-part series. Reviewing the steps involved speaks to the importance of looking past today’s unsettling news in pursuit of your greater goals.
There’s been a lot of talk about recessions lately: Whether one is near, far, or perhaps already here. Whether we can or should try to avoid it. What it even means to be in a recession, and how it’s related to current market turmoil.
After taking a closer look at interest rates in part 1 and inflation in part 2, we come to the heart of the matter: When interest rates, inflation, or both are on the rise, what’s an investor to do?
Inflation is the rate at which money loses its purchasing power over time. As you might guess, there are many ways to measure such a squishy figure. There are various economic sectors, such as energy, food, housing, and healthcare, which can complicate the equation by exhibiting wildly different inflation rates at different times. There is ongoing debate over which figures are most relevant under what conditions.