With the recent turmoil, clients are understandably nervous and wondering what to do. Some see it as an opportunity while others consider getting out.
I am reminded of a great presentation I recently watched from Larry Swedroe of Buckingham Asset Management, (and the author of 9 books including The Quest For Alpha), which I will see if I can get posted onto the site, but in the meantime I would like to share with you the message because it is a good one. (Note: this is all done from a U.S. perspective)
Let’s start by going back in time to March of 2009 at the very bottom of the market collapse. At that time, things could not have looked darker, some of the largest companies in the world were collapsing, the global economy was screeching to a halt, the media was pounding us with the message that the world was coming to an end, and investors were running for the hills.
Now imagine that you have a crystal ball that has perfect foresight with respect to the economic climate (but you cannot see what the stock markets are going to do). So you look into your crystal ball and this is what you see for the next two years or so: