Studies of past economic cycles reveal that no secular bear market in history has ended with a V bottom reversal(1). That said, there is a first time for everything.
While WFG portfolios have fully participated in the tremendous recent rebound from the March 2009 market lows, it is important to recognize that the “worm can turn” at any moment.
We will continue to observe the rules of good security selection: restrict purchase considerations to securities that represent historic good value; and, diversify, diversify, diversify. More about how we will be approaching diversification coming soon to this blog.
(1) Source: Investment Quality Trends
Markets can go down as quickly as they go up!