A Very Important Stock Strategy Overlooked in The Bull Markets – Alliance Capital Management


The market action is up considerably in 2018. This is shedding light on an overlooked investment strategy: Investing into the markets more frequently. Additionally, it is very important not to be influenced by the day to day market news and fluctuations.

Following a six-month hiatus, the markets are back at record highs. That is 1 landmark! Another noteworthy accomplishment is the extended period of bull market -- today nearly 3,500 days and going strong -- the longest bull run in history!

A cocktail of reduced corporate taxation, higher corporate earnings, a burgeoning labor market and waning commerce tariff worries have created a perfect storm for a continuing stock exchange rally. "A great deal of the bad news that the markets were digesting has begun to go away," explained Brad McMillan, chief investment officer of Commonwealth Financial Network, speaking about the Trump government's recent trade deal with Mexico.

The progress of agreeing a trade deal with Mexico is showing that experts concur, tariffs were the major worry for stocks that season. After all, the market continues to add approximately 200,000 jobs every month, the Federal Reserve insists its pace of rate hikes will likely be slow and S&P 500 businesses are on course to post 25% pre-tax earnings growth for its 2nd quarter -- the second greatest growth since the third quarter of 2010, according to FactSet.

That is why McMillan stated he sees the S&P 500 climbing to 3,000 at the end of the year. Additional Wall Street strategists have are in sync. Barclays expects the S&P 500 to rise to 3,000 by year's end; UBS sees 3,150; and Canaccord Genuity expects 3,200.

The S&P 500 broke 2,900 on Tuesday (28 Aug), a nice rebound from its February low of 2,581. The declines in February came after quiet period in the markets throughout 2017 -- and early 2018 -- where stocks rose continuously with few noticeable pullbacks.

These record highs reveal the necessity of putting money frequently into the marketplace. "With U.S. large-cap stocks, even if you had been trapped in the hype back in late January, the marketplace's last record high, and purchased shares, you would wind up 3.5% today," Colas mentioned. "If you'd bought at the end of each month at 2018, you would be up 5.8 percent. That is 67% better than attempting to time the market"

Your portfolio is going to tell you when it's time to do something," Liz Ann Sonders, chief investment strategist at Charles Schwab said. "You don't have to worry about what my views are on the market or any other pundit that's out there."

Alliance Capital Management



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