Has your portfolio been Trumped?
We have a new U.S. Presidential candidate, Donald Trump, leading the Republicans, according to several polls. Trump is a familiar face among the television-watching crowd. He is different, loud, perplexing, and exciting. He sounds a lot like the stock market, or at least what we've been told about the stock market.
An interesting thing is happening to the stock market. We have had a bombast of news and the markets have done nothing (in aggregate) in response. The world is dramatic, bold, exciting, and the politicians and news media sound the alarm bells (again). Recently, however, the stock market is seemingly mute, deaf, and dumb. Don't stock market investors know what's going on? Is this all just a conspiracy?
Perhaps a great number of Americans are polling in favor of something new with Mr. Trump because we don't believe what we're being told. We can't explain why all the news is bad, yet our lives, investments, business, and the economy are generally steadfast and strong. We want to believe the alarmists. We want something simple to explain these disconnected facts of our lives.
Something inside us wants to believe the alarmists who claim the end is nigh. Our own lives are disconnected from the drama of the nightly news and the blogosphere. Sometimes we feel guilty. The "ho hum" performance of almost every investment in 2015 stand in stark contrast to the end of the world. All of these facts are confusing.
If nothing else, the President is someone to blame. Whether it is this President or the next, blaming the President a simple story we can latch onto.
Speaking of simple, we know the long-term results of investing in the stock market favor patient and quiet investors. Turn off the radio, turn off the television, stop wondering how the news will affect your investments and you're much more likely to succeed. Create a financial plan, stick to it, and then focus on the people and activities that are rewarding to you. Ho hum.
Meet the new boss. Same as the old boss. We won't be fooled again.
Also this week: click here to read Athena's 2nd quarter market summary.