early 2016 stock market jitters

By Justin Bolmgren

Bear markets can make you gasp for air, however, they don’t have to be as scary as your think.  Often because, by the time you know for sure that you’re in a bear market, there is a decent chance that it’s close to being over.  If we notice the chart below, we will see the trend from the high in June 2015 downward.  However, an intermediate period of false hope makes it feel that we are having a second downturn.

If you once again take the stock market’s recent decline, whichbegan last June (the day that benchmark hit all time high’s); that was only about  200 days  ago.  According to Ned Davis Research, which counts 35 bear markets since 1900; the average length of a bear market is  403 days .  That being said, we are nearly half-way through this bear market-if we believe in averages.  Once again, though, intermittent periods of false hope, lead people become discouraged and panic sell on negative news.  Letting the market take it’s course after several years of market gains can be healthy.  It creates long term investing opportunities, sometimes introduces new markets, and often flushes out speculators.  In the meantime, we believe long term investors should stay the course.  Rebalancing as needed and keeping an eye to trim the riskiest assets classes.    <--- Go Back    Source: Chart, Yahoo finance

If you once again take the stock market’s recent decline, whichbegan last June (the day that benchmark hit all time high’s); that was only about 200 days ago.  According to Ned Davis Research, which counts 35 bear markets since 1900; the average length of a bear market is 403 days.  That being said, we are nearly half-way through this bear market-if we believe in averages.  Once again, though, intermittent periods of false hope, lead people become discouraged and panic sell on negative news.

Letting the market take it’s course after several years of market gains can be healthy.  It creates long term investing opportunities, sometimes introduces new markets, and often flushes out speculators.  In the meantime, we believe long term investors should stay the course.  Rebalancing as needed and keeping an eye to trim the riskiest assets classes. 

<--- Go Back

Source: Chart, Yahoo finance