Big gains. My friends at the Market Analysis, Research and Education Group (MARE), a unit of Fidelity Management & Research Co, sent me a report that compared the five worst Januaries since 1926. The average total return for these five Januaries was -6.8% as measured by the S&P 500. However, subsequent to the five worst January returns since 1926, the stock market generally recovered to post positive returns 12 months later.
The average one year return in the subsequent twelve months was 12.3%, while the two year total return was 26.0%. There was one two year return with a -8.1% result, which happened during the WWII years in 1939 and 1940. Recall, Germany invaded Poland in September of 1939, and not surprisingly, the market was already discounting global dislocations earlier that year! Funny how the market works, huh?!!
Bottom line, your goals and objectives should not have changed at any point in the last few days due to market fluctuations. If you think they have, it is only because you are reacting to fear and greed.
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