“The future is coming, be prepared is the marching song” –Paul Ebeling
Since 23 March 2020 we have seen enthusiasm among investors regarding the return to prosperity in a post-casedemic pre-inflation world.
Despite the slow rollout of the non-vaccine vaccines to the general population, the market continues to run anticipating a strong economy after the nation opens up.
The Key factor driving the market is the Fed’s Zero interest policy and its pressure on government to lift restrictions to bring back pre-casedemic employment brought about by The Trump Administration policies.
This Bull market will continue to run hard due to these factors, but investors must pay attention as there is always the chance a Black Swan will fly in and spoil the positive sentiment.
The inflationary environment that is under the radar will become a noteworthy consequence in Y 2022 and beyond. There are other risks but none of us can define them right now. We see the indicators and are being prudent advising clients to adjust their portfolios for protection,
It is very important that retail investors think about risk management and how it should be applied to their unique needs and circumstances.
The strong V-Shaped recoveries in the economy and the stock market since late March 2020 in the wake of the casedemic instant recession has many retail investors are becoming agnostic to Southside risk.
Investors are showing a level of confidence that is not reflecting how to behave in a Bear market.
This is important because when the Bear market becomes a reality, and it will, the unprepared investor scream bloody murder that their allocation was too risky, as the advisor tells them to stay the course and remind the investor they are in it for the long haul meanwhile huge gains are left on the table. And generally the retail investor does not participate in the returns generated by the hungry Bear. That feast is left to the professionals
The retail investor should get Street savvy when it comes to risk management and learn that is not prudent to set it and forget it.
By applying their life and aging requirements risk-management needs there will be no need to suffer because of a painful and Bear market.
In the planning dry powder should be assigned to a Bear market reserve account which will prevent investors from selling stocks when their prices are most depressed. And instead buy stocks at those depressed marks.
No matter if a adviser is used to manage risks or not, this way enables the retail investor eliminate unnecessary stress and to endure shock of the Quarterly statement if unprepared in a Bear market.
Plus, life’s milestone events will not need to be postponed or cancelled. Remember, it is your money, so your responsibility, and no 1 is smarter than the market.
Wednesday, the benchmark US stock market indexes finished at: DJIA +61.97 at 31437.80, NAS Comp -35.16 to 13972.55, S&P 500 -1.35 to 3909.88.
Volume: Trade on the NYSE came it at 984-M/shares exchanged
HeffX-LTN’s overall technical out look for the major US stock market indexes is Bullish with a Very Bullish bias in here.
- Russell 2000 +15.6% YTD
- NAS Comp +8.4% YTD
- S&P 500 +4.1% YTD
- DJIA +2.7% YTD
Looking Ahead: Investors will receive the weekly Initial and Continuing Claims report Thursday
Have a healthy day, Keep the Faith!
Latest posts by Paul Ebeling (see all)
- Sitting on a Cash Pile 12.0? BioTech Favored Over Legacy Pharma - March 2, 2021
- Wall Street’s Key Stock Analysts Research Report, All Buys - March 2, 2021
- Tuesday’s World Stock Markets: Asia-Pacific - March 2, 2021