Escalating trade tensions triggered a sharp pullback in August, giving up July’s gains. Global stocks were up 16.6% YTD as of July 31, and now show 12.1% gains through August 6. Now is the time to re-evaluate your tolerance for ups and downs in the market. Get a plan, keep it simple, and stay invested. Those who can stick with a long-term plan will continue to be rewarded.
Almost no one predicted the surprisingly strong 2019 year-to-date returns for stocks and bonds. The stock market is currently indifferent about a trade war or recession, while declining long-term bond yields indicate the bond market takes a different view. Most things investors worry about are not really important. What is important are the four “deep risks.”