By Tyler Henderson, Senior Advisor, Oxford Financial Partners
As some of the uncertainty from back in the Winter has faded away, there has been quite a rally in markets both domestically and globally so far in 2019. With that, we wanted to provide an update on market performance across various asset classes, provide a preview of what might lie ahead, and also highlight some key principles to always live by when it comes to investing.
Part One: Market Recap
Source: J.P. Morgan Weekly Market Recap, April 8th, 2019
Part Two: Current Observations
Several uncertainties are still weighing on the minds of investors, and these will be key areas to watch in the months ahead.
- Fed
Policy in Relation to Interest Rates/Inflation
- Markets expect one rate cut by year-end
- Six months ago, the market expected 1-2 rate increases this year
- The Fed will likely continue to be slower than market wants
- Trade
Policy and Progress
- Lack of trade resolution is slowing global growth, particularly China
- U.S – China: Expect a deal in 2nd quarter
- Brexit outcome in Europe is highly uncertain
However, while these uncertainties remain, it’s important to not lose sight of the major metrics of the economy which blazed ahead in 2018, many of which have continued into 2019:
- Worker productivity, a long-run key to economic growth, has surged
- Wage growth accelerated in response to a rapidly falling unemployment rate
- Household net worth rose above $100 trillion for the first time
- Earnings of the S&P 500 companies leaped upward by more than 20%
Part Three: General Investing Principles
Despite all of the noise out there, especially in the media, we leave you today with several guiding principles that we invite you to follow:
- Investment advice should be goal-focused and planning-driven, as sharply distinguished from an approach that is market-focused and current-events-driven
- We at Oxford neither forecast the economy, nor attempt to time the markets. In a sentence that always bears repeating: We are planners rather than prognosticators. We believe that portfolios should be built in anticipation of volatility, rather than in reaction to it.
- Once you have a plan in place – and have funded it with what have historically been the most appropriate types of investments – you should not change it so long as your long-term goals or cash withdrawal needs haven’t changed.
The general principles above, along with some others, are all delivered via our proprietary investing system called Power of 5 Investing®. This system has served our clients well for 25+ years and will continue to guide how we serve clients well into the future. If you are interested in learning more or would like to put a plan together of your own, please don’t hesitate to reach out to us at 513-469-7014 or staff@oxfordfp.com.
As we say in Power of 5 Investing, “It’s never different this time”. Markets rise and fall, but eventually continue their inexorable long-term climb upwards.
On behalf of the entire Oxford Financial Partners team, we wish you a happy, healthy and prosperous remainder 2019!
