The Election Muddle Aside, Investing Has Been a Snap Lately
Why is midyear a key time for assessing investment strategy?
Midyear is a key time for assessing investment strategy because it offers an opportunity to review and rebalance portfolios, adjust financial goals, and evaluate market conditions. This evaluation helps ensure that investments align with long-term objectives and takes into account any changes in personal circumstances or the economic landscape.
How did the stock market perform in the last 6-12 months?
The stock market performed splendidly in the last 6-12 months, with the S&P 500 posting strong returns. However, looking ahead presents uncertainties, particularly due to the current state of American politics. It is advisable for investors to focus on a long-term plan using low-cost index funds that track global stock and bond markets.
What challenges arise when forecasting the market's future?
Forecasting the market's future involves challenges such as understanding complex and evolving cash flows, gathering and managing the right data for forecasting models, selecting appropriate forecasting methods, and improving models over time through variance analysis. Additionally, factors like economic shifts, geopolitical tensions, technological disruptions, and environmental or health crises can impact the accuracy of financial forecasting6.