The first six months of 2024 have been very good to investors. Of course, it is just six months, and anything under the sun can happen in the next six months. Short-term movements in the market are unforeseeable. The only thing we have confidence in is that if we invest in a wide swath of good companies, they will reward us in the long run. We measure the long run in years—preferably five to ten-year increments.
Daily, we hear about how the markets are doing and what this or that event will do for the markets. In the US, the main exchanges open at 9:30 am and close at 4 pm (EST) every weekday except on certain holidays. (10 holidays in 2024.) We have one coming up—July 4. (Our office will be closed on the 4th and the 5th.)
Thankfully, the daily market gyrations mean little to our investment philosophy. We do not day-trade or time the markets—we invest in quality companies or good mutual funds/ETFs that invest in a broader group of good companies. And when we buy shares of individual companies, we like to buy those that return a portion of their profits to shareholders via dividends, share buy-backs, or both. We believe timing the market is not as important as time in the market.
While a good six months is always welcome, it is not necessary. If we reinvest our dividends, the lower the share price on reinvestment day, the more shares we get. The more shares we have, the greater next quarter’s dividend. Over time, the miracle of compounding dividend growth builds momentum, and the best policy is to stay out of its way while it rolls downhill.
The next six months of 2024 will undoubtedly be hectic and eventful. More so than usual due to the upcoming presidential election. And with the current 24-hour, seven-days-a-week news channels, something is always happening. There must be something—what would the talking heads, well, talk about?
July is, however, a slow time in the Advisor world (maybe you have noticed the junk-mail invitations to free dinners have dwindled.) With not much going on, it is an excellent time to take a vacation. I’ll be out of the office for the next couple of weeks. Jenna (who will not be on vacation!) will be minding the desk, and my backup, Kristin Owen is available for any financial trading if needed.
Oh, one last thing regarding the election—other than our one vote, we really have no control over the outcome as an individual. To our detriment, we tend to dwell on events & conditions that we do not control. Instead, think like a Stoic. Ask yourself, can I alter this outcome? Is this in my control? Too often, we worry and act on things that do not concern us while neglecting the many things over which we do have control. Those internal arguments (we all have them) sap life’s energy for no appreciable gain. Identify what’s in your area of personal control—and work on that!
Thanks for reading—I’ll be checking emails while away.
