The saying “Risk equals reward” is incomplete on its own. For example, were you to say, “Risk equals reward, but not all risks are rewarded”, you’d be correct (that’s a topic for another time). Similarly, as the title of this post suggests, there’s a time factor involved in the reward side of this simple equation. We’d say, “Risk equals reward. You just have to wait for it.” How long? You never know. And therein lies the risk. While we’ve recently hit new highs, the road to these levels has been peppered with stretches of no growth, or no reward for …
We’ve Hit All-Time Highs…Now What?
An answer, in one chart We’ve fielded a few calls recently from clients, who’ve asked if any changes should be made now that we’ve hit new highs in the US indices. Like any answer, we defer to the data and evidence. What does the evidence says happens after we hit new highs? The answer… …is business as usual. This chart tells us that the markets are higher a year after a new high 80.5% of the time, about the same frequency as any other time – even a little more often, though not statistically significant. A market peak, therefore, tells …