Powerful Investment Myths

Have you heard that we only use 10% of our brains? Or that lightning never strikes the same spot twice? Think those are scientific facts?

Well, they’re not. They’re actually a couple of myths that have been debunked. But many folks still take them for facts. (1)

In the long run, believing those myths may not matter at all. You may lose a trivia game, but those myths won’t affect your wallet or financial decision. The myths about investing can, though.

Have you bought into any of them without realizing it?

Investment myths can easily disguise themselves as facts. And they can mislead us into making choices that don’t line up with what we really need or want. 

Those myths and the facts behind them are the focus of this month’s Visual Insights Newsletter.

The truth is it’s easy to fall for the myths about investing, no matter how old or smart you are — and no matter what experience you’ve had in the markets. If you know the facts, though, you can look past the fiction and make better, more sound investment decisions.

And that can help you stay on track to the financial future you really want.

Go ahead and click here to see if you’ve fallen for a myth about investing.

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Rates, Inflation, Recession?

Just a quick note to offer some perspective on the (many) headlines floating around. There are almost too many things to be worried about right now, so I’d like to pause for a second to remember the abundance in our lives. Especially when so many folks are suffering. When thinking about the world gets stressful, I remind myself to be grateful for what I have.

Ok, let's dive in. (Not in the mood for economic stuff? Scroll down to the P.S. for a mental snack.)

Are we in a bear market?

In some sectors, yes, stocks have dropped more than 20% from their last peak, which is the technical definition of a bear market.(1)

So, we're in bear territory, at least. But, as of this writing, the broader S&P 500 has not entered a bear market. It might, of course. That’s absolutely possible in this environment.

However, let’s remember that we’re not day traders. We’re long-term investors, and the day-to-day and week-to-week gyrations aren’t as important as what happens over years.

Bull vs Bear: How Good Are You?

Pop quiz!

For a bear market to begin, do stock prices have to fall by 10%, 15%, or 20% from a recent high? Do you know the answer off the top of your head?

If you said 20%, you’re right!(1) Drops of 10% to 19.9% are market corrections, whereas a new bull market starts when prices rise at least 20% from a recent low.(1)

That’s just one fact about bear versus bull markets. How many more do you know?

Test your knowledge with the bear versus bull market quiz in this month’s Visual Insights Newsletter.

Click here to see it!

The more you know about bear and bull markets, the easier it can be to keep a level head and a long-term outlook when big changes shake things up.

So, how much do you know? What surprising new fact could you discover? There’s only one way to find out… Go ahead and click here to take a 2-minute quiz on the basics of bear versus bull markets.

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Difficult Times, Hope Persists

Hard times are here. (I’m still optimistic, though; I'll explain why at the end.)

People are dying, running for their lives, and watching everything they’ve worked for go up in literal flames. And, because of technology, we’ve got a front-row seat in real time.

Energy prices are spiking, markets are volatile. Oh yeah, there’s still a pandemic.

On top of whatever personal stuff we have going on, that might pale next to the suffering of war but is still our burden to carry.

Sometimes, it’s just one thing after another and everything all at once.

What do we do? How do we deal with it?

I think it depends on the day. Some days, we’re overwhelmed and struggle to make progress. Other days we press on and focus on putting one foot in front of the other.

Some of us look to our faith for guidance. We also remember that humans are resilient creatures who have survived and thrived through some terrible times.

We remember that we’re not alone.