Too Much Bearish Talk Awakens the Bulls
If you were to Google “Market Predictions for 2023” most of the findings would suggest that the 2023 stock market is in for a rough ride. However, there are pundits who would argue that markets are due for an increase in value. However, negative market sentiment seems to dominate when it comes to predictions about the market outlook for 2023. When there is so much negative sentiment that is usually a sign that the market is about to turn bullish. As Warren Buffett would say, be greedy when others are fearful and fearful when others are greedy or when the market pundits are super optimistic. Unfortunately, there is something about human nature that causes us to allow what is happening in the short term to our judgement about the future.
The bearish talk being delivered by many pundits is usually followed by advice on how to best structure your portfolio to either protect from substantial losses or to position your assets for substantial gains. In the end, following this advice, means that as an investor you may no longer be following a consistent investment approach as pundit opinions change daily. Inconsistency in your approach will most certainly lead to returns that are below the market averages. As an investor in the current environment, it is a great time to start loading up on stocks that are being identified by your investment strategy which should focus heavily on the fundamentals. No time should be spent chasing waterfalls as only investment strategies grounded in the fundamentals will be effective through good times and bad.
So, what strategies will win over the coming years and those years that follow? For us that answer is simple, strategies that combine the best elements of value, growth, and momentum investing. Adding a quality and financial strength element to those three styles allows for the development of a winning investment approach that does not have to change as market conditions change. When properly constructed, a value, growth, and momentum approach with added quality and financial strength provides excellent returns with outstanding downside protection in good as well as challenging markets. Even though the bearish pundits may continue to talk, a properly constructed strategy should identify and take advantage of market, industry, or sector weakness as a means of generating outstanding returns with lower overall risk than any stock market index. With a well-constructed bottom-up investment approach there is no need to change or use multiple strategies or play guessing games as to which direction the market is headed.
It is not very often that you will find an investment strategy that outperforms the stock market indices significantly with much lower risk so as you start the new year why not resolve to look into a better approach to managing your assets? This is what we have achieved at Investoristics. So, if you are looking for a well thought out investment approach that is easy to implement without the need for excessive trading then look no further. For more details on how to get started, please visit our website, or call to speak with one of our portfolio specialists for details about our approach.
