Investing at All-Time Highs, Weekly Market Recap
In this post: We will talk about investing at all-time highs and look at what happened this week in the markets.
This is the Millennial Wealth Blog.
Huron Peak – 14,003′
If you haven’t climbed a mountain, much less a 14,000 foot peak, like Huron, pictured above, you may have serious concerns about pushing your comfort zone and reaching new heights. Many people suffer from a fear of heights and are often risk averse. However, with the right guidance and advice, even a novice climber can tackle their fear and reach a new summit.
Oddly enough, this also applies to you as an investor.
It’s true we are at all-time highs in the stock market and it seems we are hitting new highs almost every week. So, is it a good time to invest?
Without a doubt, yes! But, Why?… Isn’t the idea to buy low and sell high?
On average, a Bull market lasts 6 times longer than a Bear market and even in the worst case scenario of investing at the very peak of a Bull market, if you hold onto your investments and stay the course, you will find yourself back in a Bull market very soon. To help illustrate my point have a look at the following mountain chart from First Trust:
This chart tells a pretty amazing story. It isn’t about the timing of your investment, but rather the time your investment stays in the market. After every recession, whether a Bear market followed or not, the stock market has always roared back to reach new all-time highs.
So… What am I trying to say?
The best time to invest, is when you have money to invest.
Don’t worry about timing the market, even if the market is at all-time highs. Nobody knows how much higher this thing can go before a correction or even a Bear market. But, what I can tell you is that valuations are reasonable and the fundamentals continue to drive economic growth. If this continues, we may be climbing a much larger mountain!
Mt. Everest – 29,029′
Whether you are climbing a physical mountain or the figurative one. Here are 5 things to consider when climbing to new heights:
- Make a plan. Stick to it. Review it regularly. When bad weather comes, and it will, make sure you are prepared!
- Keep your balance. Being overweight on a mountain can increase your risk for injury!
- Know your limitations. If the idea of climbing solo is worrisome, hire a guide who knows the landscape!
- It’s not a race. It is all about finishing and reaching the top, so don’t worry about where others are on the climb!
- Celebrate the milestones. Take some time to enjoy the new heights as you reach them!
Well, there you have have it.
Stop worrying about investing at the wrong time. If you have the money, put it to work today and enjoy the climb!
This Week In Financial Markets
All three major U.S. indexes close the week higher with all three setting new all-time highs. This comes even in the face of President Trump pulling the U.S. out of the Paris Climate Agreement, as well as a weaker job growth number for May. Unemployment, however, has reached another 16 year low. European markets end the week higher across the board, while Asian shares continue to reach new highs, closing this week at higher levels. Crude Oil finishes the week about 4% lower, closing under 48 a barrel, as the U.S. continues to add more projects, increasing supply. The U.S. 10 year treasury yield is at it’s lowest level this year ending the week at 2.15%.
Thanks for reading! Join me this time next week for my next post. If you like what you see, then subscribe here: