Does the Market Hate Uncertainty—Or Do You?
Personifying "The Market" feels good, but does it really make sense to do so? In my opinion, the market is rational and certain—it's not an entity with thoughts and feelings. But people hate uncertainty! It's people who act strangely when they perceive things as uncertain. How does the Uncertainty Paradox affect YOU?
No doubt many have heard the often-repeated refrain:
- The market hates uncertainty
Really? Since when did the market become an entity with thoughts and feelings?
The reality is that PEOPLE hate uncertainty; and, therefore, people act in strange manners when they PERCEIVE things to be uncertain. "The Market" rationally factors in all of these inputs via the price at which things transact.
In my opinion, the market is rational and certain. People are the ones that are irrational and unpredictable!
The result of the "people effect" is that the financial markets will display volatility. That is as close to a predictable "fact" as you can get!
The linked article goes into more detail on what is referred to as "The Uncertainty Paradox.
Read the article here.
- Are you concerned about the "uncertainty" of the market?
- If so, would you like to partner with someone who can help you understand the volatility associated with your investments?
Feel free to send us an email or give us a call. We'd love to have the opportunity to hear about your situation and your thoughts on this post.
Enjoy the read and remember, it's NOT about the money. It's about how the money supports your goals!
About F5 Financial Planning
F5 Financial is a fee-only wealth management firm with a holistic approach to financial planning, personal goals, and behavioral change. We provide insight and tailored strategies that inspire and equip our clients to enjoy a life of significance and financial freedom.
At F5 Financial Planning, we focus on helping individuals and families find balance between faith, friends and family, fitness and finance. We make sure that they have the financial freedom to enjoy those things in life that are important to them. And while we believe the left-brain facts and data are critical; we work with our clients to get them in the right state of mind to focus on the goals they want to achieve.
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F5 Financial Planning provides fee-only financial planning services to Naperville, Plainfield, Bolingbrook, Aurora, Oswego, Geneva, St. Charles, Wheaton, Glen Ellyn, Lisle, Chicago and the surrounding communities. Curt Stowers is a fee-only financial planner. He has passed the CFP® examination. Contact or visit Curt at his Naperville location.
We'd love to have the opportunity to hear about your situation. Send us an email or give us a call to find out more about next steps.
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