We hear this word often—cyclical—but it is not a word we should necessarily fear, right?
I have three grown children. I suppose I should say I have young adults, but they will always be four years old in my mind—a parental trait that is not unique to me alone. As I was trying to survive the glorious and entertaining chaos of my ‘three-ring circus’ of a life, from time to time I would hear more experienced mothers say ‘it’s cyclical’ a lot more than seemed possible. These super moms would say ‘that type of behavior is cyclical, she’s just a handful now, but she’ll grow out of it really soon and be her normal calm self; then she’ll do it again and again as she grows up, don’t worry.’ Which is true; it is indeed a real and familiar experience for many children as they grow and develop, and I’m sure you can relate to witnessing this pattern of behavior if you yourself have a now-grown child.
The big lesson I was getting from these super moms was that there will be ups and downs. We know these challenging behavioral phases will come, but we also know that they will pass—that things will mellow out and likely even get really great for a while. I had an article shared with me recently from Nancy Lewis-Heliotes with Financyy, that helped to shed some light on a very real and current concern for us all; this time it was not about the joys of raising children and parental highs and lows, rather, it had to do with market downturns and what, in the financial world, is called a bear market. Intimidating, right?
The AMG article stated, “The saying ‘Time in the market not market timing’ are words most investors should live by. No one knows when the biggest returns or steepest drops will come. Keeping calm and remaining invested is critical.” It’s a quick read, with a very insightful graph showing the bear market occurrence in 1932 during the Great Depression, in 1942 following the German invasion of Poland, in 1987 following Black Monday, in the beginning of the Global Pandemic of 2020, and recent energy and inflation spikes. While things are down, do not fear! There will be recovery and growth. If you are in a position to make an investment now or have already done so, keep calm and remain invested.
After reading this short yet information-rich article, I honestly felt a little less anxious knowing that, like my beautiful children, the market has its ups and downs, but it will recover. You don’t cut and run on your kids, and you should use a similar way of thinking when looking at the financial market and considering your position in it.
For more about bear markets, read A Long-Term Perspective on Market Downturns from AMGfunds.com.