“Wake me up when September ends”

Summer has come and passed and September is upon us. Unfortunately, September is historically the US stock markets’ worse performing month and September 2023 was not an exception. With the US stock market on pace to log its second straight negative month, you may be wondering what lies ahead.

The Federal Reserve continues to be a key driver of volatility in the stock market with its decisions around interest rates. There’s been much speculation how long interest rates will remain elevated and if that will cause a recession in 2024. As they say, “Uncertainty is the greatest enemy of financial markets”. 

Two months of stock market declines certainly don’t feel good; but, let’s put it into perspective. The US markets (S&P 500 index) started the year with a bang rising over 20% in the first 7 months of the year. In the past 2 months, the stock market has receded some of its gains even logging 3 straight weeks of losses in September.

While things may feel gloomy in the short term, let’s take a look at the long-term trends. The US stock market (S&P 500 index) is still up 12.6% year to date and 15.0% from 1 year ago. Despite the recent market pullback, the long-term trend is still a positive! Hopefully, it will keep heading in the right direction.

Unfortunately, rough patches are inevitable and often necessary to market recoveries. That’s just the nature of investing. We’ve gauged your ability to take financial risk based on your cash flow needs and your attitudes about market ups and downs. Quarterly rebalances allow us to monitor your investment allocation and forces us to buy when the market is on sale and sell when it is time to take money off the table.

The beauty of our approach is to help you stay diversified and maintain a course that is right for you. Hang in there, and know that overall, you are doing okay!