11/17/2022
In a world full of data and statistics, there are always debates when it comes to naming the “bests” and “worsts”. People will debate professional athletes, movies, restaurants, etc, to ultimately conclude that someone or something can be named the “best of all time” in their respective category. Often though, these debates are based simply off opinion instead of measurable data.
Although the market is a much less fun debate topic than those other topics, I’m sure many have heard, or thought, that this year has been one of the worst years for their investment accounts. The stats would agree.
On the attached slide, you’ll see a list of the worst years for both bonds and stocks. 2022 has been the worst year for bonds since 1926. 2022 has been the 4th worst year for stocks since 1926. When I first looked through this BlackRock presentation, I was shocked. I obviously knew it’s been a negative year for the market, but 2022 has been truly historic.
It’s scary when first looking at this type of data, however it’s important to look at the full picture. On this slide, it also lists the performance for the next 12 months. On average, bonds have had a return of +9.3% 12 months later, and stocks have had a return of +9.9% 12 months later. Like always, past performance does not guarantee or indicate future results. However, when looking over a longer time horizon, these “worst years of all time”, get overshadowed by positive years.
Market volatility is natural and part of the process. During times like these, it's important to stay focused on the overall plan and not fall victim to panic-selling.
By the way, Michael Jordan is my answer for the best athlete of all time. Why?
-6 NBA Championships…6-0 in the Finals…2 separate 3-peats
-5 League MVPs
-6 Finals MVPs
-10 NBA Scoring Titles
-14 All Star Game Appearances…only missed the All Star Game when he took a break from the NBA for 1.5 seasons to play Minor League Baseball
-3 All Star Game MVPs
-2 Olympic Gold Medals
-NCAA National Championship
Please don’t hesitate to reach out if you’d like to discuss further.
BlackRock – Student of the Market: October 2022. Morningstar as of 9/30/22. Past performance does not guarantee or indicate future results. Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual. All indices are unmanaged and may not be invested into directly.
Investing involves risk including loss of principal. No strategy assures success or protects against loss.
There is no guarantee that a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk.
