Market Notebook


Continued Volatility in Equities and Bonds

Both equities and bonds experienced significant volatility last week on U.S. and China trade concerns.  While no one tends to complain about volatility to the upside, long term investors tend to wince when experiencing volatility to the downside.  It is important to note that volatility is a normal, natural occurrence within markets.  In fact, one could call volatility a “feature” of markets if the goal is to buy quality assets at reasonable prices.  Short term volatility including “corrections” are not to be feared when holding a well constructed portfolio.  Instead of fearing volatility, look for the opportunities volatility creates.  Even in portfolios holding little cash it is possible to shift allocations to take advantage of opportunities should they be recognized.  Since the trade spat with China continues, expect the unexpected and thus volatility to continue.

The week ahead will be a heavy economic data release week.


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