April Market Returns Historically
According to LPL Research, April is historically a very strong month for market returns in the market.
Reviewing the chart below shows the trend from 1950-2021 with average returns in the S&P 500. Even with this great research, I remain cautious as we have many headwinds that could cause stagflation.
Stagflation involves high inflation, high unemployment and slow or negative economic growth. The current environment of geopolitical conflict, inflation and the federal reserve policy with interest rate hikes may ultimately cause a slowdown in the bull market.
Should You Be Optimistic?
Nevertheless, I remain an optimist with market returns as I’ve written in my past blog post on market returns and corrections. The investment process is long-term and we should always remain mindful of the plan. Even when your plan changes, we as your financial advisor can make those adjustments to accommodate your life transitions.
Aswath Damodaran, Professor of Finance at The Stern School of Business at NYU has provided great research showing how stocks have performed compared to bonds, T-bills and real estate. The geometric average return of Stocks from 1928-2021 is 9.98% return using the S&P 500 (including dividends) compared to Real Estate returning over 4% during that same period.
For my clients that are aggressive and are invested in Crypto Currency, remember that to accept high returns you must accept the downside risk.
The energy space has seen great returns, but can that sustain? For anyone interested in a change and seeing what energy, oil and gas investments we can offer, please reach out at any time.
As always, please do not hesitate to contact Sage Financial Investments for a Free Strategy Review or Second Opinion to discuss your portfolio or re-visit your risk profile.
*Investment advisory services offered through Brookstone Capital Management, LLC (BCM), a registered investment advisor. Investments and/or investment strategies involve risk including the possible loss of principal. For a complete description of investment risks, fees and services, review the Brookstone Capital Management firm brochure (ADV Part 2A) which is available from your Investment Advisor Representative or by contacting Brookstone Capital Management.