{"id":6712,"date":"2023-10-16T14:20:03","date_gmt":"2023-10-16T19:20:03","guid":{"rendered":"https:\/\/schenkelberg.investments\/?p=6712"},"modified":"2023-10-16T14:20:21","modified_gmt":"2023-10-16T19:20:21","slug":"time-is-on-your-side","status":"publish","type":"post","link":"https:\/\/schenkelberg.investments\/?p=6712","title":{"rendered":"Time Is On Your Side"},"content":{"rendered":"\n

Standard & Poor\u2019s 500 Index total return for the Third Quarter of 2023 was negative (-3.3% according to J.P. Morgan). We haven\u2019t experienced a negative quarter since Third Quarter 2022. We have seen some drastic ups and downs in market performance the past couple of years.<\/p>\n\n\n\n

Total return for the S&P 500 Index has been overall reasonable, but looked at year to year the numbers can be quite large.\u00a0 It is these larger shorter term swings that make following the stock market feel like a roller coaster.<\/p>\n\n\n\n

Standard and Poor\u2019s 500 Index Annual Total Return<\/strong><\/strong> (Source: The Motley Fool)<\/em><\/strong><\/em><\/strong><\/td><\/tr>
2022<\/td>-18.04%<\/td><\/tr>
2021<\/td>28.50%<\/td><\/tr>
2020<\/td>18.06%<\/td><\/tr>
2019<\/td>31.20%<\/td><\/tr>
2018<\/td>-4.23%<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n

The chart below is a good reminder that stocks and bonds can greatly fluctuate from year to year. However, when held for over five years the opportunity for stocks to be positive is extremely high. From 1950-2022 one year returns for stocks has varied from +47% to -39%. The five year rolling average for stocks shows a very small amount of times that stocks were negative for five years. Going out 20 years the rolling average has always garnered positive returns. In fact, the lowest stock return for a 20 year rolling average since 1950 is +6%.\u00a0<\/p>\n\n\n\n

The majority of investors are investing in stocks and bonds for periods greater than five years. Even for retirees the time frame can be very long. A retiree aged 70 could still live for another 20-30 years. Once investors get older than that the investment focus often shifts to how stocks and bonds are going to perform for their children, as they will not need to spend their investment funds within their lifetime.  <\/p>\n\n\n\n

Having a longer-term view on investing is very important. It can often be tempting to get swept up by the current political environment, latest headline or short term market swings. But staying focused on why you are investing in the first place and the time frame for these events can be very helpful. How much you consistently save is more important than when.<\/p>\n\n\n\n

The best analogy I have ever heard about the market is using a yoyo going up stairs. The yoyo will rise and fall in sharp movements. However, as time goes on you are moving up the stairs and end up overall higher in the end despite the large ups and downs along the way.<\/p>\n\n\n\n

<\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

<\/p>\n\n\n\n

<\/p>\n","protected":false},"excerpt":{"rendered":"

Standard & Poor\u2019s 500 Index total return for the Third Quarter of 2023 was negative (-3.3% according to J.P. Morgan). We haven\u2019t experienced a negative quarter since Third Quarter 2022. We have seen some drastic ups and downs in market performance the past couple of years. Total return for the S&P 500 Index has been […]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"off","_et_pb_old_content":"","_et_gb_content_width":"","jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[119,123],"tags":[],"class_list":["post-6712","post","type-post","status-publish","format-standard","hentry","category-market-commentary","category-market-performance"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/p7kXxe-1Kg","jetpack-related-posts":[{"id":6528,"url":"https:\/\/schenkelberg.investments\/?p=6528","url_meta":{"origin":6712,"position":0},"title":"U.S. Stocks Dominate","author":"J.J. 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Schenkelberg, CFA","date":"October 10, 2024","format":false,"excerpt":"IndexThird Quarter 2024Year\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 To-Date 2024S&P 5005.5%20.8%Dow Jones Industrial Average8.2%12.3%Russell 20009.2%10.0%\u00a0\u00a0MSCI All Country World Index ex-US7.7%13.8%\u00a0\u00a0Aggregate Bond5.2%4.6% Performance Source: Koyfin Price Return U.S. Versus International The S&P 500 Index, an index of large U.S. companies, posted a price return of 5.5% for the Third Quarter of 2024. Large U.S. stocks underperformed\u2026","rel":"","context":"Similar post","block_context":{"text":"Similar post","link":""},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":6917,"url":"https:\/\/schenkelberg.investments\/?p=6917","url_meta":{"origin":6712,"position":3},"title":"Annual Trends \u2013 How Far Can We Go?","author":"J.J. 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