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This Time Is Not Different

 Mike Earl, CFP®, CPWA®



Source: Center for Research in Security Prices, Investments Illustrated, The University of Chicago
Balanced Portfolio consists of 45% large cap US stocks, 5% small US stocks, 10% international stocks, 30% US government bonds, and 5% Treasury bills.

Staying the Course

When advising our clients to stay the course (i.e. stay fully invested), our advice is not based on wishful thinking about the markets. The advice is grounded in historical reality, and in a hope for the future.

There are no guarantees in investing (nor in life). But we can look to history as a guide. Even if you had started investing on the cusp of the Great Depression, investing in a balanced portfolio for ten years gave you a positive return.

Every scary situation feels different (because each one is different). Our clients are invested for the long-term. And over the long-term, staying the course in a balanced portfolio of stocks and bonds has paid investors well.


Photo by Mick Haupt on Unsplash

Disclosure: The charts and figures contained herein are based on historical total return data beginning January 1, 1926 (U.S.) and January 1, 1935 (Canada), and ending at the most-recent month end for which data are available. They are for illustrative purposes only; they do not constitute investment advice and must not be relied on as such. They assume the reinvestment of all investment income, and no transaction costs or taxes. Portfolios are neither real, nor recommended. An investment cannot be made directly in an index. Government bonds and Treasury bills are guaranteed by the full faith and credit of the United States government as to the timely payment of principal and interest, while stocks are not guaranteed and have been more volatile than the other asset classes shown. International Stocks exclude U.S. Stocks. International stocks involve special risks such as fluctuations in currency, foreign taxation, economic and political risks, liquidity risks, and differences in accounting and financial standards. Past performance is not an indicator of future performance. © 2019 Investments Illustrated, Inc.