January has been very kind to some investors so far this year as the S&P 500 is up over 4.5% just this month. As I mentioned last week, when the first five days in January are positive the chances for a profitable year have historically been around 75%. (Remember, past performance is no guarantee of future results.) In addition, the average gains have tended to be quite impressive as well. It is amazing to me how quickly the global markets can change from trading on macro headlines to going straight back to reacting to fundamentals. Last month, we would have all been on pins and needles waiting for a resolution to the Greek debt debacle. Now, it barely gets five minutes of air time on television!
In my opinion the market is changing from a mean reversion market to a trending market. The recent news out of Greece and the lack of panic out of Europe have caused some investors to focus on fundamentals again, thus going back to individual stock analysis and leading to lower overall correlations.
Stay safe out there and remember to consult with a financial professional should you have questions or need help.
As a reminder the S&P 500 is an unmanaged index. Investors cannot invest directly in an index.
Eric Marvin, CFP®, CRPC®
JPT012012-124
