Rational Advisor

Patience seems to be in short order these days.

Dispirited investors unmet expectations are leading them to the wrong conclusions about the sustainability of the market recovery, the positive outlook of most stocks, and the suitability of stocks within an investment portfolio.

In the worst cases, unrelenting changes are continually being made when all that’s really called for at this stage of the game is patience.

Would you pull the pitcher for walking a batter in the first inning? Woudl you rip a bulb out of th eground after a week, if it hadn’t bloomed? Would you stop exercising if you didn’t drop 15 pound following your first day at the gym?

I hope I needn’t go on with the oh-so-clever metaphors to make the point that patience is imperative to realizing, any susbtantial result. It’s no different with stocks.

Impatience is an understandable byproduct of the information age. Advertising messages tell us, “you need to have it now”,”faster is better”, and “why wait?”.

The internet was supposed to bring instantaneous access to market information and therby the “key to unlimited wealth”. But what its lead to is a lot of impatience, and excessive trading, rash decision making, market timing and undue stress.

The market is recovering, as is the economy, but full realization of significant returns is down the road.

It is often the case that the best time to buy stocks, is when pessimism prevails. Conversely, when optimism reigns supreme, markets tend to top.

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