A day after the election, the stock market celebrated, taking the Dow Jones Industrial Average up 545 points.

Part of this is a relief rally (the election was finally behind us) and part was some appreciation for the outcome. Now investors can focus on fundamentals and potential risks to the business outlook. Among those are interest rates, tariffs, and the potential for economic slowing. You can add a few other worries and many will. To be fair, there are always some worries out there in the investing landscape.

We have predicted for a long time now that we believe that our stock market is trapped in a trading range. Stock market prices through two corrections and several rallies have defined the parameters of that range. In October, the market challenged the lows of February, but did not break. The highs of January and September are still the upper end of the range; expect a lot more of this.

Returns in stocks will now come not from stock market performance, but from compelling individual company stories that simply demand better valuation. In other words, it will be stock picking not indexing that will be the key to future success. Good things are happening in many companies.

It is our job to find, evaluate, and invest in the right ones; not an easy task, but one we relish. Stay steady, my friends.

El Solo Toro