March Market Madness Edition (Not the Fun Kind)
If you’ve been following along, you might remember in my first blog I mentioned we could see some early-year weakness. That’s exactly what we’ve gotten—choppy markets, a little discomfort, and plenty of second-guessing. Not fun, but also not unexpected.
What’s interesting is that the S&P 500 has historically tended to find a bottom around mid-March (see below), at least on average over the past 20 years. That doesn’t mean this time has to follow the script, but it does provide helpful context in a market that often feels random.
Part of the disconnect right now is that things feel worse than they look. While the index itself hasn’t fallen dramatically, roughly 40% of stocks within it are already down more than 20%. In other words, a handful of large companies are holding things together, while much of the market has already been under pressure. Stepping back helps. Since WWII, there have been 105 pullbacks of 5% or more. Only a fraction of those turned into deeper corrections, and even fewer became full bear markets (see below). Most declines, even when they feel uncomfortable in the moment, tend to be temporary rather than catastrophic.
What’s also made this stretch frustrating is that the usual places investors look for safety haven’t really helped. Gold and silver have both struggled recently, and bonds haven’t provided much relief either, as expectations for interest rate cuts have been pushed further out. For now, cash feels like the only place to hide, but that’s rarely a long-term solution. Here at Axio, we continue to come back to the same message: volatility is normal. Could things get worse from here? Of course. Could we be closer to the bottom than it feels? Also possible. The key is that we don’t need to guess. Staying disciplined, sticking with a long-term plan, and tuning out short-term noise has historically been the approach that works best.
Volatility isn’t a flaw in investing—it’s the price of admission.
Until Next Time,
Wes
Axio Wealth Strategies
P.S. It might be worth going back and rereading that first blog… it’s aged pretty well.
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