Here’s what the recent rally could mean for you.
Provided by Adam P. Liquori
Some people in recent weeks may have been feeling that “the stock market seems to be doing so well but I’m not participating.”
A look behind the headlines helps tell the story.
A CNBC study found that between the stock market high on February 19, 2020—and the new market high on August 18, 2020—only 38 percent of stocks in the Standard & Poor’s 500 index posted gains. By contrast, 62 percent showed losses.1
The best performing sectors during the six-month period were consumer staples, health care, and information technology. If your portfolio was overweight in these groups, you may have outperformed.
Meanwhile, financials, energy, and utilities lagged behind.1
Each year, some companies are big winners in the stock market and some can’t keep pace with the popular index. This year is no different.
However, we often don’t see such a wide divergence by the market averages. For example, the Nasdaq composite gained 26 percent through August 21, 2020. That compares with an increase of roughly 5 percent for the S&P 500 and a slight loss for the Dow Jones Industrials.2
Investors need to understand that it’s not about how the stock market performs. It’s about whether you are pursuing your financial goals based on your time horizon and risk tolerance. How the stock market moves from week-to-week, or month-to-month, should be of some interest but perhaps not an overriding concern.
If you want to revisit your goals, please give our office a call. Or, if you’re second-guessing some of your goals, let us know what’s on your mind. We’re here to help you pursue financial success.
Adam P. Liquori may be reached at (949) 481-4141 or aliquori@aplwmg.com.
This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note – investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.
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Citations
1. CNBC.com, August 22, 2020
2. MarketWatch.com, August 21, 2020