Discipline and the Long View

Lately, we’ve been getting a lot of questions from clients who are feeling anxious about what’s happening in the news.  The drumbeat of headlines continues as always, and many people are on edge about the market and investing in general: what will happen with Brexit, what’s going on with the trade war, what IS an inverted yield curve anyway?  When confronted with a never-ending stream of negative news coverage, we find it can be helpful to take a longer view.  Following is a chart showing the growth in the MSCI World Index from 1970 to 2018, punctuated by major negative events.

Markets Have Rewarded Discipline
Growth of a dollar – MSCI World Index (net dividends), 1970-2018

Markets have rewarded Discipline

Source: Dimensional Fund Advisors

A disciplined investor looks beyond the concerns of today to the long-term growth potential of markets

Many of these events have had a very real and lasting impact on the world and on people’s lives – but in the context of the market, their impact is short-lived. In spite of this, the stress these headlines generate is hard to avoid. We help our clients navigate this stress in several ways:

  • Financial planning to help ground financial and investing decisions in our clients’ own lives instead of the news du jour.
  • Constructing a portfolio that is strong enough to weather downturns in the market while also participating in long-term growth.
  • Establishing and building a long-lasting relationship, so clients know whom to call when they’re worried about money stuff.

If you have any questions about your own finances, we welcome a conversation.