My blog post last week highlighted some market statistics showing that >5% drawdowns are a common occurrence and have ALWAYS been followed by eventual recovery to new all-time highs. As a reinforcement to that thought, investment thought-leader Charlie Bilello came out with more statistics that ring true for those worried about the recent market drawdown:
Though no one likes losses, long term investors have ALWAYS been rewarded with market returns reaching new all-time highs by ignoring volatility and holding through tough times. Though “they all seemed like the end of the world at the time”, markets have always recovered.
Though there are troubling economic and geopolitical situations currently occurring at the same time, this reminds me of the book The Rational Optimist: How Prosperity Evolves" by Matt Ridley. In it, he posits that human innovation, trade, and adaptability consistently drive progress, even through crises and society has always found a way to overcome adversity and lead to better outcomes.
D&A will continue to follow a globally-diversified, long-term strategic risk-managed approach to portfolio management for clients consistent with their needs and goals and will (almost) never deviate from a strategy due to adverse market conditions.