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SeptemberAnother All-Time New High!
When news outlets or pundits on TV announce, “The stock market made another all-time high today!” it can often spark mixed emotions. If you are currently invested, great, but if not, then looking to invest at that point can lead to a bit of anxiety among certain investors.
The fear of “buying at the top” might make some hesitate, worrying that the market has nowhere to go but down. This hesitation is often fueled by recency bias—the tendency to place too much emphasis on recent events—and loss aversion, where the fear of potential losses outweighs the anticipation of possible gains. But before you let these headlines and psychological traps scare you away, let’s take a closer look at what these new highs really mean in the grand scheme of things.
The truth is, the stock market has been setting new highs for decades. If you had a dollar for every time the market hit a new high, well, you might just be contributing to that next new high! It’s easy to get caught up in the excitement, but history teaches us an important lesson: it’s not about when you invest, but how long you stay invested. The saying, “Time in the market, not timing the market,” rings true for a reason. Those who try to time the market often miss out on the long-term growth that comes from simply staying the course.
Before you let the headlines sway your decisions, take a moment to reflect on your own financial goals, risk tolerance, and timeline. Are you investing for a quick return, or are you planning for the long haul? The answers to these questions are far more important than the latest buzz about a market high.
Remember, the market’s ups and downs are normal, and over time, it has shown a remarkable ability to grow, despite occasional setbacks. The key is to remain focused on your personal financial plan and not get distracted by short-term noise—or by the psychological biases that can lead you astray.
If you’re feeling unsure about your investment strategy or need help aligning your portfolio with your goals, please reach out to me, or any of us at Per Stirling. We’re here to help you navigate the complexities of the market and keep you on track to achieve your financial aspirations.
Written by: Steve Cartwright, CFP®
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