Welcome to today’s Arch capital market update!
Recently we have seen a bit of volatility and its something we expected.
The markets have been really strong over the last few years and some stable and obviously they have a few down days.
What is important to focus on when markets do this is your emotions.
We don’t want to overreact. We don’t want to suddenly make a decision that doesn’t align with our overall strategy and emotions can really get in the way of a successful investment outcome.
The news headlines and the media are going to play a big part in manipulating your emotions. They finally have some big scary news to talk about and that is going to be the headlines that you see. This is just the editors and news outlets making the most of this time when the markets are volatile so be careful about the headlines and overreacting to the media.
The idea here is that we are always coming back to focusing on what we can control. Your asset allocation is the most important aspect of your portfolio diversification.
The key elements across any market conditions are:
- Don’t overreact to short-term events
- Don’t use guesswork (stock picking)
We don’t use a forecasting methodology, so it is important that you make sure that you are comfortable with our strategy and our asset allocation before you move forward.
As always thank you and see you next time.