Typically, we start the year with a growth-oriented mindset, excited for new opportunities and change. With so many events causing concern, it is important to not only focus on positive change for our world but also reflect on the positive momentum we experienced throughout the last year.
We have seen diversification add value by mitigating volatility and through exposure to categories that have outperformed following a couple of years of highly concentrated performance.
While a stable job market and cooling inflation are positive signs, declining GDP growth, rising consumer debt and uncertainty surrounding trade policy are areas of concern. Nobody knows how all these factors will play out. If only the outcome were as easy as choosing ice cream flavors.
Whether a decline is modest and short-lived or sometimes long and painful, investors should stay with their long-term plans and continue investing.
Are investors optimistic, emotionally spent or climbing a wall of worry as we move into the first quarter of 2025?
How we prepare our portfolios for what is next is the cornerstone of why diversification works over a long-term view within the context of change.