In today’s investing environment, most investment professionals continue to be negative about the market’s future prospects. You can turn on the TV, or read it in the financial news, but most pundits continue to be negative about the market. Because of this pessimistic view, many investors are now sitting on the sidelines. The equity markets are seeing their lowest level of investor exposure since 2009! There is so much negativity, but let’s look at the chances of having a positive return in the equity markets dating back to 1926:

56% chance of positive daily return
63% chance of positive monthly returns
75% chance of a positive annual return
88% chance of a positive return in 5 years
95% chance of a positive return in 10 years
100% chance of a positive return in 20 years

Yes, markets move down as they did last year, but more often than not, they move higher. That is why trying to time the market is incredibly difficult and is yet to be successfully achieved on a consistent basis. Yes, there is a debt ceiling negotiation ongoing, fear of a recession, and fear of the Fed, however markets tend to move higher over time. Money flows and earnings remain strong which gives us solace in future market prospects. As the Lonely Bull says, “Stay steady, my friends!”

Scott Wohlers, President

For the Lonely Bull