Persistent (def) - continuing to exist or endure over a prolonged period
You may have noticed that a new year tends to bring with it a media bombardment of “expert” forecasts of what we can expect in the forthcoming year. Nowhere is this more prevalent than in the financial media as it relates to Wall Street.
Wall Street forecasts lack persistence. Their shelf life is typically very brief. 2020 was a great example; once COVID hit, existing forecasts became worthless. While that is a stark example, the fact is that events and/or circumstances will always alter the script. Logically, we all know that no one has the proverbial crystal ball.
Further, now that people largely “click” the news they wish to consume, there is substantial incentive to create sensationalized headlines and content as to maximize views. It seems that at any given time one can find “expert” forecast that are contradictory to one another… Perplexing.
Forecasts are alluring to investors because our brains are seeking certainty. Yet, when it comes to the markets, can any volume of analysis provide such certainty? And if not, what does one gain from consuming voracious amounts of analysis?
Here at Guided Path Wealth Management, we adhere to a philosophy as opposed to offering a forecast about a short-term future no one can reliably predict. https://www.guidedpathwm.com/philosophy
Our philosophy is persistent because it is based on enduring historical perspective and prudent investor behavior.
So, what will 2021 bring?
In full disclosure, this is nearly identical from year to year:
- The economy/market will do something surprising.
- Investors who watch the market often will experience more stress than those that do not.
- The financial media will seek to exploit the human emotions of fear and greed.
- Temptations will arise to abandon your plan based on expert forecasts and/or short-term market performance.
- Disciplined investor behavior will positively influence your long-term success.
While this seems simple, we recognize that in practice it can be challenging. Patience and discipline are virtues because they are difficult to persistently adhere to. Perhaps then, among an advisors most important roles are to help their clients separate the sensationalized “analysis du jour” from what really matters – enduring historical perspective.
I wish you a prosperous, fulfilling, and persistent 2021.