I got one of those intermittent e-mails from our financial services people this morning, the kind of thing that lays out advice for various financial events (retirement, college expenses, etc.) and, almost always, counsels us to stay the course and stick to both our goals and our investment strategies.
We meet with our advisor - who we like a lot - occasionally, and often give him a hard time if the stock market is down. He always, good-naturedly, shows us the long-term (decades-long) chart of the stock market, which shows a lot of spikes and dips but always trends upwards. Even after the crisis in 2009, it didn't take long for business to be as usual.
I was interested in what today's e-mail might say about being in the middle of the Atlantic in 1492. I guest I wasn't too surprised: stay the course, stick to goals and strategies.
One point interested me. The message asked the question:
"Did the downturn keep you up at night, or cause emotional moves, such as reducing risk or moving out of the market? If so, it's probably time to examine the level of risk in your portfolio.
The combination of "stay the course" and "adjust your portfolio for your risk tolerance" - both messages we have heard constantly for years - means one of two things, I think. First, that the industry thinks that things will get back to normal, just as they have after every disruption since the end of WWII. The new world, then, will be a lot like the old world, investment-wise.
Or perhaps not. Perhaps there is not a sense of moving on to a place where the rules are different. Denial (We can't change that much)? Politics (It's not really that bad)? It won't take anything more than an adjustment of your risk tolerance. Nothing to see here; you're overreacting. Does the financial services industry think we're on a shakedown cruse and will return to Palos de la Frontera sometime soon?
Either way: we haven't looked at our investments since February. When we get to the new world, we'll see what we've got.
No comments:
Post a Comment