As we head into the home stretch for 2023, the markets are back in rally mode. Performing best is the S&P 500 and Nasdaq as larger cap stocks continue to shine. But that pendulum continues to swing and it remains a significantly more challenging environment for non-index stocks and smaller companies.
Or maybe not… but for the moment, at least, animal spirits are back, we have had three good weeks in a row for the broad stock market averages, coming out of the interest-rate panic that crested in October, and now everyone’s looking for a “Christmas Rally” into the end of the year.
The temptation, particularly when the market is rolling along nicely as it (mostly) has been this year, is to try to buy the hottest companies, in the hottest sectors, and get rich quickly by getting in before everyone else realizes how hot they are… and getting out with a big profit before everyone else loses interest.
That is how it has always been, that’s what fuels the enthusiasm for trading, and we all get pulled into the search for those stories from time to time, with at least part of our capital… but I confess that my preference is usually to find companies that have found a way to get a little better every year, make a little more money, and gradually become far larger and more profitable without ever doing anything “sexy.”
Here is snapshot from an article that I read from Carson research, felt sharing with you…
The above chart from S&P 500 clearly highlights the importance of holding for longer term gives higher gains. And a clear message from that article is not read too much into the short term volatility. So stay focused…
Busy And Useful 