Since the beginning of the year, we have seen stock markets grind lower with most broad based markets now down nearly 20% year-to-date. It's therefore natural that human behaviour would make us pause with concern. During these turbulent times, investors are often asking themselves, "Should I cash out and just go to cash? When will the bleeding stop? Is my retirement in jeopardy?". This is a normal human reaction to uncertainty. However, history has provided many lessons that unfortunately are often ignored by investors. 

"The idea that a bell rings to signal when to get into or out of the stock market is simply not credible. After nearly fifty years in this business, I don't know anybody who has done it successfully and consistently. I don't even know anybody who knows anyone who has" -- Jack Bogle

Here's an excerpt from our Co-Chief Investment Strategist, Macan Nia, describing current market conditions and how every client should view the current market sell-off:

Stock markets across the world have declined materially so far in 2022. However, stock market corrections are both very common and also very difficult to predict. Since 1980, the S&P 500 Index has fallen an average of ~ 14% in any given calendar year, but is positive 78% of the time for the full year with average rate of return of ~ 10%."

Investing is a probability-based decision and the historical evidence suggests that the odds of success are in an investor's favour when allocating capital to stocks when they have entered a correction. But when the correction occurs, investors are often paralyzed by emotion (particularly fear) and don't take advantage of the opportunity. When you're in the middle of the storm, it's hard to see that sunny days are ahead! 

Attached are a series of charts that we use in our discussions. The goal of the first few charts is to remind ourselves that despite corrections, the odds of success are overwhelming in the favour of investors. The remaining slides don't attempt to provide a plan to 'time the bottom' but provide a framework in which investors can feel confident that their patience will be rewarded in the future should they allocate capital in the middle of the storm.