One-minute explanation of recent market activity

The ten-year chart above shows:

  1. The S&P 500 index itself
  2. The Vanguard S&P 500 ETF (Symbol VOO)
  3. iShares Core S&P 500 ETF (Symbol IVV)
  4. Spider S&P 500 ETF (Symbol SPY)

2., 3., and 4. are exchange-traded funds (ETF’s) which are proxies of the S&P 500 index itself. The chart shows all four and the Monday Morning Millionaire Program recommends investing in one of these. Note that they are exactly the same, as expected. They show the performance of the American economy as a whole. (Buying the American economy is the third habit of highly effective investors.) The S&P 500 and its proxies haveĀ gone up over 150% over the last decade. You can cherry-pick investments which have done better but only with hindsight. No other category of investment has done as well. That has been the case for over 100 years and is likely to continue.

Now, the media are making a lot of noise about the market drop of the last week. (The five-day chart below shows the S&P 500 index itself and the three ETF’s which mirror it.)

Monday Morning Millionaire Program members have a long-term investment view. They would yawn at a 4% drop in after arise of over 150%. It has happened before. History shows that 5 percent drops happen more than twice a year; 10 percent, twice within three years; 20 percent, about once every three-and-a-half years; and 30 percent, once every five years. The more active members might start getting ready to rebalance their asset allocation and buy one of the increasingly cheaper proxies of the American economy.

Monday Morning Millionaire Program members know that the media need to say something even when there is a nothing to say.

Dr. Milan Somborac

The Monday Morning Millionaire Program supports do-it-yourself (DIY) investors which I have been for over 50 years. About my team and me

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