Important March Market Update With Jason Wenk
Broad US equity markets experienced another sharp decline during the past week as the S&P 500 dropped almost 6% – its worst week since January 2016. This continues the recent string of volatility as the S&P 500 has advanced or declined by 2% or more in eight of the weeks so far this year, with no such weeks in all of 2017.
However, while equity markets remain fickle in 2018, it is critical not to get caught-up in the short-term swings in the market. Market corrections are a somewhat frequent occurrence. They happen approximately once every year and historically have taken around four months on average to reach new all-time-high levels. During these correction periods, volatility is generally expected to rise as investors recalibrate their portfolios.
While the recent volatility has pushed stocks lower, longer-term momentum remains mostly intact as many indicators continue to display positive characteristics. The market can potentially produce great returns long-term, but the price of admission is the ability to stomach these short-term flips of volatility.
As investors, we need to stay committed to our long-term financial goals. By aligning our portfolios with our long-term objectives and maintaining a disciplined investment process, we can increase the probability of a successful outcome.