How We View The Past Vs The Future FINAL

What If You Knew

What If You Knew?

What if you had a friend who secured a DeLorean and traveled ahead five years to learn about and profit from the future?

Upon his return, you asked him about the stock market so you could make the best decisions for your investments.

He said, “Oh, it was rough. In the next five years there is a major economic crisis and not one, but two bear markets.”

What Would You Do?

Given this information, what would you do?  Would you buy stocks coming into this environment?

Would you hold your current investments? Or would you sell?

Our brain’s natural response is to get us to safety and avoid danger at all costs. The impulse and associated feelings may influence many investors to sell.

Learning From the Past

This scenario played out over the last five years.  Just in the last five years, we had the COVID-triggered economic crisis that drove the market went down 34%, and then surging inflation where the market went down 25%.

Yet, despite these negative events, the market increased significantly over the last five years…causing anyone who “got to safety” to miss out on significant gains.1

Helpful Perspective

Even if you were certain of some information about the future, much information is simply unknown.

The market is too complex and uncertain to try to time or outsmart.

Plus, even if you knew the facts, you have NO IDEA how humans will react.

For that reason, you have to create a financial plan that has nothing to do with “prediction” and use principles and truth as your primary influence for your financial decisions.

And that is why my Clients hire me – to help you make the best decisions possible, to begin getting more return on life, and align their time, talent, and treasure with their closely held values, goals, and objectives.

Stay invested,

– Kaleb Paddock, CFP®

Learn More

You can learn more about Ten Talents and Kaleb Paddock, a financial advisor based in Parker, Colorado, by clicking here.

Kaleb can be reached at (720) 710-0939 or kaleb@tentalentsfp.com.

You can check out the Ten Talents YouTube channel by clicking here.

Returns from 05/2019–05/2024 and include the reinvestment of dividends. Performance calculated at dqydj.com. The Standard & Poor’s 500 Index is a capitalization weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries. All indices are unmanaged and may not be invested into directly.

© The Behavioral Finance Network.

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