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Patience, Grasshopper!

Mark J. Smith, CFP®, CPA/PFS, CIMA®
August 8, 2019

Wouldn’t it be great if we could all get rich in a way that’s quick, easy, and guaranteed? Maybe we could spin some straw into gold, rub a genie’s magic lamp, or find a pot of gold at the end of the rainbow.


Of course, I’m joking (because spinning straw into gold actually sounds like a lot of work). A more realistic approach to investing and wealth building includes a balanced portfolio that considers your financial goals and is set up for the long term to withstand market fluctuations.

Trending Now: The Stock Market & Your Portfolio

Investors often express anxiousness about investing in the S&P 500 citing its volatility. Yes, there is volatility, but here’s what we know to be true: many factors, such as corporate earnings, affect the stock market. As a result, the stock market fluctuates. We understand that can be scary for a lot of investors. That’s when it’s important to put down our microscopes and take a step back. What is the big picture telling us?

The above chart shows 58 years of corporate earnings and stock market returns. There are some notable downs, but the overall trend is consistently upward, yielding an average annualized return of 9.79%. In mid-July, stocks hit record highs, and some predictions are that earnings could keep stocks high. However, the recent trade issues with China has caused many investors to flee the stock market as volatility returned.


The lesson from studying these trends: history is on the side of stock market investors and they can remain confident that long term, the market has rewarded the patient investor.

Staying the Course

There is a “formula” to building wealth, and if we go about it in a patient, systematic way, our chances are greatly improved that we will succeed in achieving our financial goals.


While there are no guarantees as we move forward, studying the stock market’s historical trends leads us to believe that the outlook for portfolios that include stocks in the US is a positive one.


Being patient and waiting for results can be a challenge, but it’s a much more realistic way to build your wealth.

We’d love to talk to you about your financial goals. Make an appointment today to meet with one of our team members. You can leave your spinning wheel at home!

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Source for chart:  Morningstar, multpl.com, Political Calculations and M.J. Smith & Associates. Hypothetical $10,000 invested in S&P 500 from 12/31/1959 – 12/31/18 with dividends reinvested.  Assumes annual rebalancing of the portfolio, no fees, no taxes. Past performance is no guarantees of future results. The S&P 500 is an unmanaged index of 500 widely held funds. One cannot invest in an index.

Any opinions are those of M.J. Smith & Associates and not necessarily those of Raymond James. Expressions of opinion are as of this date and are subject to change without notice. There is no guarantee that these statements, opinions or forecasts provided herein will prove to be correct. Investing involves risk and you may incur a profit or loss regardless of strategy selected. Keep in mind that individuals cannot invest directly in any index, and index performance does not include transaction costs or other fees, which will affect actual investment performance. Individual investor's results will vary. Past performance does not guarantee future results. Future investment performance cannot be guaranteed, investment yields will fluctuate with market conditions. Dividends are not guaranteed, can fluctuate, and must be authorized by the company's board of directors. Rebalancing a non-retirement account could be a taxable event that may increase your tax liability. You should discuss any tax or legal matters with the appropriate professional.

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