• Stock markets have had a good run since early 2020 amid mostly calm conditions, but we’re not surprised by recent volatility. 
  • We don’t equate higher volatility with a high likelihood that we’re headed toward a bear market or a recession in the near future.
  • Market timing requires two choices: when to sell, and when to buy back in. The costs associated with mistiming either of these decisions mount quickly.

It’s quiet. Too quiet. 

Film directors know that the best way to set the stage for the entrance of a howling T-Rex or a hungry great white shark is to let an eerie calm unsettle the audience. 
Fortunately, real life doesn’t work that way. Investors can be assured that there’s no good evidence indicating that current conditions can reliably tell us anything about what will come next.

Why bring this up now? Some might say it had been too quiet in financial markets prior to the recent return of volatility. Stock markets have had a good run since early 2020 without experiencing much volatility. We wouldn’t be surprised to see a bit more volatility going forward, given some of the risks facing the global economy. But we believe the positives outweigh the negatives.

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