CautionAugust 4, 2021 -
Categorized in: IAG News
Depending on what you are driving and when, the cautionary road sign below could be a sign of future thrills or vehicular anxiety.
Pair a well-maintained sports car with a dry, sunny day and you can almost become one with the road. You feel confident and in control.
Pair a dilapidated SUV with a thunderstorm and your anxiety jumps as the wipers try to keep up so you can see the next curve. You are on edge, but not panicked.
Pair an 18-wheeler with a snowstorm and your knuckles are white with fear. You may decide to take a different route.
Whenever the calendar flips to August or September, I get a bit apprehensive about what may be around the corner. So far this year, the financial markets have been driving a sports car on a dry, sunny day. Traders feel pretty confident and in control.
August and September tend to be the two “curviest” months of the year. There is absolutely nothing that requires history to repeat itself, and this year is different from most others. However, there is a real possibility that we could see our first official dip or correction of 2021 this month or next.
As with any skill, the ability to navigate market volatility can be lost when not practiced frequently. The S&P 500 Index has been within 5% of its record highs since November 2020. Traders, and maybe even some long-term investors, may not be psychologically prepared for the curves ahead.
This is a good time to reaffirm your long-term investment plan, tune up your car’s suspension if necessary, and calmly anticipate the curves that may be ahead.
Quote of the week: Charles R. Swindoll “Life is 10% what happens to you and 90% how you react to it.”
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