The stock market has been on a tear this year.
Even the most optimistic Wall Street strategists didn’t see this coming.1
To be fair, the above chart is for year-end projections, and there are still three months to go. One of those months includes an election, in case you haven’t heard.
Who knows? Maybe stocks will dip hard and come in line with one of those price targets. Or, maybe it will continue to set new record highs.
Either way this is a compelling reminder that investing based on forecasts and price targets can be a challenging game. After all, there was so much to be afraid of!
Eddy Elfenbein writes,
Looking back at this year, I recall reading so many pundits telling us about things to be very afraid of. Very, very afraid! The economy was about to sink the market. Or the Fed. Or the dollar. Or some other bogeyman. Well, the bull charged past them all.
It’s funny how so much of good investing comes down to simply being patient.2
Patient and proactive, that is. Not patient and passive.
If you were patient and passive, awaiting the perfect time to “get in” the market, your patience may not have paid off.
For long term investors, “It’s too late now” is not in their vocabulary. It’s hard to make money in the stock market if that is your mantra. There’s always a reason not to invest.
This is not just about this year. A correction or bear market could be just around the corner. But that’s the way it always is. The thing is, the long-term historical trend line for US stocks has (thus far) always been higher too.
Don’t forget: Pessimism has slain many investment portfolios.
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Sources:
1. Charlie Biello. This Week in Charts (9/25/24).
2. CWS Market Review - September 27, 2024.