October 4, 2021
Encouragement: Keep Perspective
Despite the unprecedented global COVID-19 pandemic and all of the ripple effects that it has caused, investment markets across the world have been relatively benign ever since last April/May thanks to the unprecedented stimulus introduced by governments and central banks around the world. In fact, aside from a few smaller bouts of volatility such as those related to the 2020 U.S. presidential election last fall, markets have largely trended higher.
A recent 5% pullback in markets has market participants more worried than we have seen them all year, given the significant amount of background noise related to China, debt ceilings, tax law changes, COVID variants, and expectations of waning stimulus.
As always, a small dose of perspective is incredibly helpful in effectively assessing how the current landscape should affect decision making.
- First, it is important to observe that, despite the alarming news cycles we have seen recently, the S&P 500 has only experienced about a 5% pullback. This coming after a year that has conditioned us to expect nothing but more record-highs!
- Second, it is prudent to remind ourselves that an average year sees three different 5% drops in the S&P 500. Until September, we hadn’t seen any!
In our portfolios, we see the recent volatility as a manifestation of many uncertainties looming on the horizon. As these uncertainties become certainties (What will the new tax law be? Will the debt ceiling be lifted? Will the federal reserve raise interest rates?), we expect market volatility to wane. Although we expect volatility to wane and markets to finish the year on a positive note, we see the recent 5% pullback as very nominal, and not necessarily an opportunity to radically change portfolio positioning.
Thank you for allowing us to partner with you as we navigate the ever-changing market. We appreciate your continued trust. If you have questions or would like to dive deeper into this quarter’s outlook, please reach out to our investment team. We’d be happy to set up a virtual coffee to talk more.Parable Wealth
Advisory Persons of Thrivent provide advisory services under a practice name or “doing business as” name or may have their own legal business entities. However, advisory services are engaged exclusively through Thrivent Advisor Network, LLC, a registered investment adviser. Parable Wealth Partners and Thrivent Advisor Network, LLC are not affiliated companies. Information in this message is for the intended recipient[s] only. Please visit our website parablewealth.com for important disclosures.
Different types of investments involve varying degrees of risk. Therefore, it should not be assumed that future performance of any specific investment or investment strategy will be profitable.
Asset allocation may be used in an effort to manage risk and enhance returns. It does not, however, guarantee a profit or protect against loss. Performance of the asset allocation strategies depends on the underlying investments.
This website is intended to provide general information about Parable Wealth Partners and its services. It is not intended to offer or deliver investment advice in any way. Information regarding investment services are provided solely to gain an understanding of our investment philosophy, our strategies and to be able to contact us for further information.
Market data, articles and other content on this website are based on generally available information and are believed to be reliable. We do not guarantee the accuracy of the information contained in this website. The information is of a general nature and should not be construed as investment advice. Please remember that it remains your responsibility to advise Parable Wealth Partners, in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing/evaluating/revising our previous recommendations and/or services, if you would like to impose, add, or to modify any reasonable restrictions to our investment advisory services.
We will provide all prospective clients with a copy of our current Form ADV, Part 2A (“Disclosure Brochure”) and the Brochure Supplement for each advisory person supporting a particular client. You may obtain a copy of these disclosures on the SEC website at http://adviserinfo.sec.gov or you may contact us at firstname.lastname@example.org to request a free copy via .pdf or hardcopy.