Wow, what a first quarter….
In all of 2017, the S&P 500 index experienced just 8 days with fluctuations greater than 1% (positive or negative). Through 4/15 the same index has seen 29 such moves.
Simply put, volatility is back.
During times like this it can be helpful to remind ourselves why “volatility” and “risk” are used as synonyms in investing circles. Volatility, by definition, refers to the movement of prices around the longer term average price; positive and negative movements contribute equally to a large volatility measure. That said, no one ever complains about volatility when it’s on the upside. This is where Risk comes in.
The actual risk when investing during volatility is not being able to stay disciplined while sticking to a plan and then selling at the wrong time. Risk is for those without discipline.
As an adviser to successful individuals, families, and companies, we believe we add value in many ways; but if we had to do one thing –and one thing only– it should be to impart a disciplined, process-based, unemotional approach to managing wealth.
For a recap of 2018’s first quarter market movements, check out our Quarterly Newsletter below.