Markets Resemble a Box of Chocolates

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“Life’s like a box of chocolates; you never know what you’re gonna get.”
— Famous line from Forrest Gump, the movie.

A fresh batch of data is ready every day for processing by stock and bond markets.
Some days you get optimism, some pessimism and the rest run-of-the mill.

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Can the markets advance from here? Yes.
Can the markets fall from here? Yes.

Making sense of daily dose economics is far from an exact science.
The same “box of chocolates” analogy can easily apply to the markets.

Let’s peek at a few chocolates:

  • Earnings are one very important market mover. They can stumble, but are still there.
  • Just a few years ago families had savings. Today, many are laden with debts.
  • Four years ago the US 10-year bond yield was around 4%. Nowadays it hovers near 1.7%.
  • Housing was a dependable economic booster. The slump puts pressure on appliance and furniture purchases.

We continue to review plenty first-time portfolios.
Many overloaded with a less than desirable asset mix to endure the uncertainty.

Our recommendation is that time for debate and decision is here.
Especially, for investors whose stocks and mutual funds exceed 65% of total.

Adrian’s tips:

Are you curious about what’s inside your box of chocolates?
Current market levels are opportune ballparks to tweak your portfolio.

Consider these moves:

  • Take a little profit on some investments that have done well.
  • Set aside your emotions and sell those losers that are not coming back.
  • Reduce your risks by buying more of the boring short-term bonds.
  • Make sure that quality spreads through all your income investments.

Knowing what’s in your box improves your investing outcome.
I welcome questions and comments.

Best,

Adrian

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avatarAdrian Mastracci - KCM Wealth Management posted Monday, October 15th, 2012.

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