Is the Stock Market Suffering From the Summer Doldrums?

Perhaps, but is this something that should be of concern to investors?

Some market observers are suggesting that the stock market, after most major averages have reached new, all-time highs, may be in for a difficult summer.  This would be consistent with that old, sometimes accurate adage, “sell in May and go away”.

Often cited as cause for concern are; stagnant consumer spending, lackluster capital investment, uncertain oil prices, inflation pressures and scant housing growth.

While there is some validity to all of these issues, they have been more or less prevalent throughout the substantial increase in stock prices over the last several years.

All of this may be relevant if you are thinking in terms of trading, clearly a focus of many of the guests on CNBC and other stock market oriented media outlets.  This should not be a focus for investors.  Markets fluctuate.  This is hardly new news.  However investors should take a longer view that reflects historical trends.  The average annual return for the S&P 500 from 1926-2014 has been 10.1%.

Investors, in conjunction with their advisor(s), would be well advised to formulate and maintain a long term approach that is consistent with their resources and objectives.

All comments and suggestions are welcome.

Walter J. Kirchberger, CFA®