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The 3 Investment Truths

The 3 Investment Truths

October 07, 2019

Although markets can be somewhat unpredictable at times, beyond expectations and predictions, hope and fear, there are certain investment truths that will always hold.

Investment Truth #1

Through all the fog of distraction, the primary driving force of a stock market will always be corporate earnings. There is too much to distract us; political turmoil, inflation, unemployment, and economic recovery. So far, this year has been a positive year for the stock market (although not without volatility). More precisely, this year so far has been a positive year for corporate earnings.

Investment Truth #2

Valuations matter. As is the case with any investment, all asset classes have a natural length of a coil. If that coil is stretched beyond its natural length, it will compress. If, on the other hand, the coil is compressed, it will expand back to its natural length. This reversion can be dramatic like we witnessed in international markets in recent years, which had been compressed after years of under-performance.

Investment Truth #3

Discipline and mathematics should be used to construct any portfolio. While it is human nature to try to predict the short-term and avoid losses, it takes a disciplined approach to achieve your goals.

Like we mentioned before, markets are always changing and can sometimes be unpredictable. As advisors, we never try to predict what is going to happen in the markets. Therefore, we always keep these three investment truths in mind when deciding what is best for our clients. 

If you need help, we are always here.  


Associates of Krietzberg Wealth Management are registered representatives of Lincoln Financial Advisors Corp. Securities and investment advisory services offered through Lincoln Financial Advisors Corp., a broker/dealer and a registered investment advisor. Member SIPC. Insurance offered through Lincoln affiliates and other fine companies and state variations thereof.  Krietzberg Wealth Management is not an affiliate of Lincoln Financial Advisors.  CRN-2700519-082319