Being Kind to Yourself – Markets, News, and All

Be kind to yourself…

It wasn’t that long ago that many of us monitored our accounts on a monthly basis—if even that often. Today, with mobile apps and browsers at the ready on our smartphones and computers, we can see how our accounts and the markets are doing by the minute, in real time. For some, checking one’s account values frequently has become a habit. For others, it’s practically a compulsion, part of what they do almost constantly with their phone.
Most of us are hunkered down at home now, and for many the TV provides good company. With so many 24-hour news channels, and still only 24 hours in the day, it is amazing how broadcast producers find countless “experts” to peddle their views to the audience. Personally, I miss the calm of yesteryears’ newscasters. No matter how passionate they were about a topic, they were never compelled to yell, jump up and down, or use extreme adjectives.
While the pullback is not alarming in and of itself, the velocity has been extraordinary. As we are writing this short note, the market is up for the third day in a row, having demonstrated that it can move up as fast as it can move down.
We offer three observations about this period:

  • Don’t look at your account values daily or weekly. Do look occasionally, but try to look only monthly at your statements. If you are a frequent looker, you probably already realize that while it feels good to look when the market is going up, it feels measurably worse when your account is going down. For lots of reasons, our brains are wired more towards the negative. We will spare you the more detailed psychology lesson.
  • Change the channel or mute the TV if you have the business news on. Most of the “pundits” couldn’t make it as weathermen. If you think about it, how good are we at predicting the near-term future? The business news channels spend hours upon hours interviewing, debating, and speculating in an attempt to predict the immediate future. We know in periods measured by years that the equity markets can create amazing wealth for investors, whereas in the short term we can expect the markets to have big swings. The patient investor, however, (versus the short-term speculator) knows that, in time, their investments have the potential to provide good returns.
  • As things return to normal, and we have every reason to believe that they will, let us know how you are feeling about your investments. What have you learned about your financial plan? There are lots of ways we can help and, most importantly, we want to help. We look forward to bringing to bear our many years of investment experience to help you and our other clients pursue the goals and plans they have.

One more note: We remain optimistic about the future of the markets, mankind and our world. From oil embargoes to the 1987 crash, 9/11 to 2008-2009—all events like no other we had seen—we moved on. The markets moved on too, generating dividends and capital appreciation. This week, for clients that had available cash to invest, we added Johnson & Johnson(JNJ) to the portfolio. We believe JNJ will provide great earnings growth (not to mention 57 years of consecutive dividend increases). We are thrilled to own it at these prices. We will continue our bargain hunting…
Be well and stay healthy,
J. L. Bainbridge & Co., Inc.

Disclosure: A complete list of the holdings in the equity portfolio from the last 12 months is available upon request from J.L. Bainbridge & Co. Inc. This information is for educational and informative purposes and shall not be considered a specific recommendation. The material being provided is thought to be accurate. However, the information is compiled from multiple resources and may become outdated or otherwise rendered incorrect by new research or corrections. Adjusted EPS estimates are sourced from the companies’ quarterly reports and conference calls as well as other sources. The holdings listed may not be the holdings in your accounts. The holdings are in the equity growth model used by the firm. The firm will seek to have your account reflect what is held in the model. However, to get a more thorough understanding of the performance of your account please review your statement.
JNJ Dividend increase sources from JNJ Investor Fact Sheet
EPS Growth – Earnings Per Share Growth – A company’s profit divided by its number of common outstanding shares.Source: Nasdaq
It should neither be assumed that future results will be as profitable or that a loss could not be incurred.