The author F. Scott Fitzgerald once wrote that "the test of a first-rate intelligence is the ability to hold two opposed ideas in the mind at the same time, and still retain the ability to function." This concept, often referred to as "cognitive dissonance," is something all investors must continually grapple with. This is because financial markets can swoon seemingly without reason and, in the worst case, in a way that appears to contradict underlying fundamentals. In these situations, investors can either try to justify these market swings or recognize that they are likely to be temporary. How is this relevant to investors in today's market and economic environment?
We discuss in this episode of The Wealth Effect Podcast:
📈 Magnificent 7 Stock Returns
📊 Q3 GDP Growth Components
📉 Stock Market Pullbacks
Matt Faubion, CFP®
Founder - Wealth Manager
Show notes and charts:
A small group of stocks has driven market swings this year
The economy is stronger than anticipated
Market corrections occur regularly
The bottom line: The Magnificent 7 stocks, responsible for much of the market's year-to-date gains, have started to stumble as higher interest rates impact the markets. And despite many signs of economic strength and the stock market not having returned to its previous all-time high, it recently fell into correction territory.
What is the proper portfolio strategy for you as an investor and your wealth plan? Let's find out - Reach out through the link below to start the first step in our complimentary risk and portfolio evaluation!
This content is developed from sources believed to be providing accurate information and provided by Copyright (c) 2023 Clearnomics, Inc. All rights reserved. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security.