Maintaining Investment Discipline When Markets are Volatile and Scary

“I became a disciplined investor over 40 years. The virus broke me in 40 days. I’ve survived — and even prospered through — four stock market crashes. But nothing prepared me for this.” So went the title and opening lines of The New York Times writer James Stewart’s March 27th article, in which he describes his personal struggles with sticking to a disciplined investment plan and dealing with unprecedented stock market volatility. As Mr.

A History of Market Ups and Downs

For the third day this week, we have seen significant volatility in the markets. Yesterday, the S&P 500 closed at 2,741.38, which places it close to a bear market, defined as a 20% drop from a recent high.

In times like these, it can be hard to watch the headlines and, closer to home, to worry about what’s happening in your portfolio. Especially following the stellar year we had in 2019, a market drop like this makes all of our pulses pound a little faster.

Coronavirus, Oil Prices, and an (Almost) Bear Market in Stocks

Eleven years ago, on March 9, 2009, the U.S. stock market reached its low point of the Global Financial Crisis. That dark day marked the beginning of an extended bull market that took the S&P 500 Index from 676.53 to 3,386.15 on February 19, 2020 – a 401% increase. Over the last three weeks, we’ve witnessed a sudden reversal. After today’s dramatic 7.6% market drop, the S&P 500 now sits at 2,746.56, a 19% decline from the recent high.

Coronavirus Hits the Stock Market: Now What?

worried man looking at phoneStock markets worldwide have declined sharply this week as investors grapple with the ongoing spread of coronavirus disease (or COVID-19). Over the last two trading sessions, the S&P 500 Index is down 6.3%, and the Dow Jones Industrial Average has fallen by 1,911 points. Capital has surged into traditional safe havens, driving up the price of government bonds and gold.

Quarterly Market Review Fourth Quarter 2019

Tuning Out The Noise

When faced with short-term noise, it is easy to lose sight of the potential long-term benefits of staying invested.

 

For investors, it can be easy to feel overwhelmed by the relentless stream of news about markets. Being bombarded with data and headlines presented as impactful to your financial well-being can evoke strong emotional responses from even the most experienced investors. Headlines from the “lost decade”1 can help illustrate several periods that may have led market participants to question their approach.

 

Mitigating Risk: How Bonds Play a Crucial Role in Your Portfolio

Global equities had mixed performance in the third quarter with large U.S. stocks inching higher and small U.S. stocks falling 2.4%. Foreign stocks struggled in the face of trade negotiations and ongoing tariff disputes. Real estate was a strong performing asset class, rising nearly 6% as interest rates declined, reducing financing costs. As has been the case for much of the year, political headlines remained prominent in the U.S. news cycle as the 2020 presidential election looms on the horizon and an impeachment inquiry got underway.

The Efficient-Market Hypothesis & DFA: The Building Blocks for Our Investment Philosophy Since 1991

For over 28 years, Dowling & Yahnke has invested client assets as fiduciaries. Our firm is independent with respect to the investment vehicles we use, freeing us to design portfolios we believe will best meet client objectives. We continuously scrutinize our investment philosophy and the tools we use, challenging our thinking and experience to ensure our clients receive the best experience possible based on their financial objectives, risk appetite, and tax situation. In this quarter’s newsletter, we will explore our longstanding relationship with Dimensional Fund Advisors (DFA). While DFA mutual funds represent a minority portion of the assets we use in building portfolios, many of the philosophical and practical concepts underpinning DFA’s approach also permeate our thinking.