Some Things Just Don’t Change

Date: Tue, 02 Jul 2013 11:37:54 -0400

Probably the dumbest question an investor can ask of anyone who is seriously engaged with the equity markets is: “what do you think is going to happen to (fill in the blank: the market, xyz stock, abc Mutual Fund, the economy, etc.)”

We saw earlier this week some wild downward moves in the global markets precipitated by — again, fill in the blank (Bernanke, The Fed in general, Congress, Immigration Reform, Investor fatigue, Possible Increase In Interest Rates, etc.). In fact, the headlines were so “doom and gloom,” that I felt that I had to write an interim Commentary: “OMG, The Sky Is Falling — Not!” Of course, the doom and gloom were succeeded by three of the most upward moving days of the year.

As we come to the end of this “interesting” week, I find the inter-day headline on the Wall Street Journal’s website reading:

U.S. Stocks Gyrate, Capping Volatile Quarter

I am reminded of JP Morgan’s famous rejoinder when asked what he thought the market would do. His prediction: “The Market Will Fluctuate!”

And so it shall.

One of the highest compliments that I had paid to me was by a client, who had been attending our educational sessions for a couple of years. She said (I’m paraphrasing now): one of the best things about you is that your message never changes!

I’m glad she noticed. If nothing else, given what all of the decades of independent academic research has taught us, we would be fools to become inconsistent in our message. There are certain verities in investing and, until such time as they are disproven by equivalent, quality and independent academic research we shall continue to remain consistent in our message:
Own Equities
Diversify Globally Across Asset Classes
Rebalance Systematically

And, absent a major change in the aforementioned research, continue to be repeated until death!


Copyright (c) 2013
Frederick C. Taylor
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