“Market correction: A euphemism for losing a lot of money rapidly.” Peter Lynch
What was made out to be the next great market crisis came and went within five trading days. That’s not to say we are out of the woods yet, but the hype machine provided many unsuspecting investors several nights of lost sleep. Markets are more stable. Volatility is back within normal levels, historically speaking. Interest rates are not falling off a cliff. Breathe a sigh of relief.
Corrections are part of investing. The S&P 500 did not even hit the primary 10% correction level during the last week. Algorithmic trading, or computer models in place of human traders, have amplified the speed at which markets move in this modern age of trading. Corrections may not last as long as they have in the past, but you can bet they will happen much quicker, and be more violent. This is the new normal.
From an economic standpoint, our perspective is that we are transitioning to slower growth. Separate from some outside shock, the expectation should be a slowdown scenario, even as volatility reminds investors of the importance of diversifying. Slower growth is still growth.
You can always bank on the proactive communication of Watershed’s plan and our perspective. Rest easy knowing your specialists have gamed different scenarios and are ready to act when the time comes.
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