Looking at the stock market over the past 20 years, you might think of Charles Dickens: It was the best of times—and the worst. But while the 2000s and 2010s have differed starkly in performance, collectively they have reinforced investing lessons on patience and discipline.

Every month, our firm sends out a Reality Check to our clients. The topic varies month to month, but it typically covers various aspects of behavioral investment counseling and financial planning. On the heels of the recent volatility over the past week, we thought it would be useful to provide a few paragraphs from a commentary written by Brian Wesbury, an Economist at First Trust, that put a lot of the recent events into perspective. 

Regardless of what the financial media is stating as the cause of this pullback, i.e. Fed Rate Cute, China, Trade War, Current Administration, etc., you must understand that it is only temporary.  Following the herd and reacting to the volatility can do irreparable harm to your plan.  As Nick Murray says, repeat the following mantra: This time is not different. This too, shall pass. Of course, these moments can still be stressful and by no means should you ignore stress.

​​If you any questions about this topic or wish to receive our Reality Check emails, please contact us.

In just a few short weeks, Americans will head to the polls to elect the next President of the United States.

While the outcome is unknown, one thing is for certain: There will be a steady stream of opinions from pundits and prognosticators about how the election will impact the stock market.  As explained in the below graph from Dimensional, investors would be well-served to avoid the temptation to make significant changes to a long-term investment plan based on upon these sorts of predictions.

Additionally, this short 4 minute video from Vanguard aids investors in shifting their focus from the short term impact of the election to focusing on the long term.  Decades of historical data tell us that presidential elections typically don't have a long-term effect on market performance.

This data does not suggest an obvious pattern of long-term stock market performance based upon which party holds the Oval Office. The key takeaway here is that over the long run, the market has provided substantial returns regardless of who controlled the executive branch.

For more resources on this topic, please contact us.

Each quarter, we put together a newsletter that provides updates on the firm, insights to investing and a market review of the previous quarter. The image preview above is the cover of the document.

If you would like to receive the full digital copy please contact us. ​

Dave Butler, a Vice President at Dimensional, shares a client's experiences of working with an advisory firm and how it helped him focus on the things he can control.

"I’m focused on the things that will really impact my long‑term financial future: spending less and saving more. These are two things I can control (unlike when the Fed is going to raise interest rates)."

Click the image to download the PDF.