Being Smart with $$ -- "I Don't Know" may be the best answer.

Where does your financial adviser think the market will be at year end? Here’s the answer you should be looking for: “I don’t know.”  Senior market strategists from major Wall Street banks disagree with each other every day on the near-term direction of the stock market.  And market prices reflect an equilibrium created by all those buyers and sellers.  Since the value of the stock market already reflects the views of all the bears and bulls, it really doesn’t matter if your adviser thinks the market is going up or down because he or she doesn’t know any better than all the other chief market strategists out there.  In fact, if your adviser is guessing on the direction of the market, then he or she may not be advising on an appropriate long-term investment plan, instead shooting for gains from market timing (which most research says is a losing strategy.)  So what’s a better answer from your adviser? He or she should advise you to stay invested in a portfolio suitable for your profile, add to it regularly and ignore all the so-called experts who as a group have a questionable ability to predict the short-term direction of the market.

Larry Pike, CFA

Client Priority Financial Advisors LLC
www.clientpriority.com