We were talking about, uh, the recent volatility in the markets. So we saw the market drop, the NASDAQ actually did drop into correction territory for a short time between August 1st and the 5th, but it has appeared to come out of correction territory at this point. So, you know, we’re talking about, we got a question that we were answering in the last segment about one of the stocks that we use and how much it had dropped. You know, it was down four or 5% in a short period of time. And I don’t know, I guess the question was, some people were surprised to see that happen. I’m not surprised to see it happen. We have pullbacks in the market. A 5% pullback is very, very common. It happens usually more than once a year. A 10% correction tends to happen on average about every 12 to 18 months. So, you know, that wouldn’t be surprising either. It’s yet to be determined whether this is going to be something that’s just a temporary little hiccup in the road or something that we need to take more seriously. So, you know, we have adjusted our buy list accordingly. Partners would have gotten an alert out on Monday. So if you didn’t get that in your inbox, you may want to check your junk folder if you are a partner. Or just log into the website and then go, there’s a, there’s a partner tab for alerts and you can read the most recent alerts. So in light of all the market volatility, I just want to give you a couple of things to keep in mind. Things to help you stay grounded and keep things in perspective. So, you know, the S&P 500, which we call the market, that’s one of the indices that we track, has increased more than 10% since the start of 2024. That is even including the most recent drop of over 7% and then the subsequent recovery. So this is the kind of annual gain that most investors are glad to see. You know, if the year ended today and you had a 10% return, I would think that most investors would consider that a good return. So really and truly the losses that are, and I hate even calling them losses, because it’s not a loss until you actually sell something and lock in your price. So it was really a fluctuation in value. So fluctuation in value to the downside and decline in value that happened through this past Monday really just set the market back to where it was in May. So to put that in perspective, if you were happy in May, shouldn’t you be happy today with the same comparable return? And really, instead of looking at how much your investments decline in a very, very short period, you should really be looking at whether or not that decline has a significant impact on your financial future. So if your financial future starts in less than two years, you may need to rethink the risk that’s in your portfolio. If the volatility that you just experienced was a little too much for you, that may be a good reason to readjust. But, you know, try to avoid timing the market at all costs. And if you’ve been a partner for any length of time, and you know, we love to hear from you when the show is live. We love for partners to call in and share their experience using the financial issue strategy. But there’s a video on our website for partners where our founder and previous host of the show talked about putting in bottoms. And so, you know, I’m a financial advisor in private practice and we eat my own cooking. So whatever we’re putting out to the partners is what we’re doing in the strategy there. And so, you know, as I’m managing portfolios that are, you know, two years, three years, five years or more old, it’s rare that I come across positions that are actually down in value below where they were when we got in. So the longer you go, the harder, or the more unlikely that it becomes that you’ll really test the cost basis or that you’ll go below your cost basis. So that’s a great value in being a long-term investor. I think that also has a certain psychological effect to it too. If you log into your brokerage account and you see a lot of red on the screen, if you’re a trader, you probably haven’t owned those positions for very long. Seeing a lot of red, I think, does a lot of damage psychologically to somebody’s fear factor as to whether or not they’re optimistic or not. The longer you go, the more likely it is that you’ll see a lot of green that can have a very positive psychological effect for long-term investors. And we think it’s really the best kind of strategy to have.
What To Consider During Market Pullbacks And Corrections