Lessons From 2020

Happy New Year!!

Looking Back on 2020, there were three investing themes that were once again reinforced:

  1. A Long-Term Plan is Critical  With significant events such as the pandemic and the election, if you didn’t have a strategy you could easily be knocked off course.  Unfortunately, research suggests that many investors chase performance. They buy when assets are running hot and sell when asset prices are low, potentially leaving money on the table.  Having a long-term plan helps keep you focused on the goal and avoid the noise.
  1. The Media is NOT a Long-Term Investor’s Friend  Investing based on the headlines is typically not a good way to invest because markets have already priced in a great deal of the news into market prices and are looking ahead. The media gets paid based on attention grabbing headlines, not whether you make money or not. We take the time to get to know you to find the right portfolio mix suitable to your risk preferences and goals.
  1. Patience and Persistence  Market volatility is a normal part of long-term investing. Capturing the benefits of being invested requires us to stay patient.  We must focus on long-term returns that asset classes have been able to offer to those who can stomach and ride out the short-term bumps in the road.  A large part of the return on owning stocks tends to happen in compressed periods of time. As a result, we believe that it’s “time in the market,” not “timing” that matters the most to building long-term wealth. 

Inevitably, 2021 will bring its own set of unique challenges and we hope to keep you on track to meet your long-term goals.  If you need help, don’t hesitate to reach out or visit us at waterwaywealth.com


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