The Future is Uncertain (2020)

The Future is Uncertain (2020)

April 30, 2020 MonkWealth Investing, Monthly & Financial Updates

You probably clicked on this post because the title was relatable in a certain way.

How did it make you feel? Vulnerable? Scared? Expecting to read how we’re headed for the biggest economic collapse since 1930? Or maybe excited, interested? Or simply indifferent?

Whatever the case is, if you’re reading this blog you’re most probably interested in growing and maintaining a diversified, long-term, passive portfolio, understanding exactly what “time in the market beats timing the market” conveys.

In that case, you shouldn’t fear the markets at all. If you do, it contradicts your investment strategy and you should immediately reevaluate one of the following factors:

Risk taking willingness

Risk taking ability

I already have dozens of post that can help you make a better assessment of your risk tolerance, but would recommend setting yourself in the right mood by reading the following post first:

Your Role in the Next Big Thing  https://monkwealth.com/your-role-in-the-next-big-thing/

With that said, let’s see where we stand at this moment. Here’s the S&P 500’s performance in the past 6 months, as a representative for the stock market:

Pretty volatile, yes. However, if you already determined your investment strategy and asset allocation, you should be pretty indifferent. If you expected to see technical analysis (which doesn’t work in semi-efficient markets) or speculation (“where the S&P will end up in 2020”) you’re set for disappointment. A piece of financial advice might come in handy: don’t trade based solely on what you read.

And for total peace of mind, don’t listen to economist. I can’t say “nobody knows what’s going to happen” because some of them (us?) apparently do. Some of the prophecies will be fulfilled. Some with a delay when they’re no longer relevant. And some won’t.

So, picking the right economist is like picking the right stock. Maybe the right thing to do is diversifying in terms of the investors you trust so that you allocate your investments accordingly… And you’ll end up with what you should have from the start – a diversified portfolio of asset classes diversified within.

To continue reading, please go to the original article here:

https://monkwealth.com/the-future-is-uncertain-2020/ .