Hello,

When you see headlines like, “Nvidia becomes world’s most valuable company…”¹

Or read that a few stocks are responsible for most of the market’s gains…

Or see some newsletter bragging about a X,XXX% return on a single stock pick…

It’s natural to wish you could go back in time, invest in a “sure thing,” and ride the escalator all the way to the bank.

But that just isn’t how investing works.

(By the way, Nvidia experienced the fastest loss in history pretty quickly after reaching the top spot.²)

There are two hard truths we want you to remember when you get that FOMO (fear of missing out) feeling:

1. There’s no such thing as a sure thing. No one predicted the AI boom that rocketed tech stocks to the stars in 2024.
2. High-flying stocks are very vulnerable to sudden crashes that also hit without warning.

It’s easy to let headlines overwhelm logic.

Everyone loves a winner, but no one is good at consistently picking them (or predicting the moment when winners turn into losers).

Sure, some folks like to gamble big to win big.

More often than not, gamblers lose big.

(The headlines skip that part, and the losers usually slink off to a corner instead of showing up on the news.)

Economists call that “survivorship bias.”

It’s when we forget that for every winner, there are many losers.

When we draw conclusions from the select few who win big while ignoring the failures, we're likely to make mistakes.

And picking a winner while skipping the losers is all luck.

How do we give ourselves the best chance to invest in market winners?

We've got bad news for you: it’s boring and doesn’t make for great headlines.

We pick a strategy and stick to it.

We diversify.

We check in and adjust based on what we see.

Rinse and repeat.
 

There’s no magic to long-term returns.

Instead, it takes discipline, patience, and consistency.

And that’s what we’re here for. If you’re a client, we’ve built you a financial plan with a roadmap for your retirement, and you have our team at Eagle Wealth dedicated to your success.

If you’re not yet a client and would like to learn more, give us a call at 541-330-0220.  We’re here to help.

­Patiently,

Your Eagle Wealth Team

The Week on Wall Street

Stocks were under pressure last week as investors appeared to rotate out of mega-cap tech stocks and into areas that may benefit from lower interest rates.

The Standard & Poor’s 500 Index fell 1.97 percent, while Nasdaq Composite Index declined 3.65 percent. The Dow Jones Industrial Average bucked the downward trend, up 0.72 percent. The MSCI EAFE Index, which tracks developed overseas stock markets, slid 1.48 percent for the week through Thursday’s close.³

Dow Leads Again

The week began very differently than it ended.

All three averages rallied over the first couple of days this week, with the Dow leading on both days. Fed Chair Powell indicated the Fed may not wait for inflation to reach its 2 percent target before considering a rate move, buoying the markets.^4,5

Then, markets hit a speed bump as investors appeared to take profits and rotated away from mega-cap tech names. The selling broadened beyond tech-related names on Thursday as all but one of the S&P 500's 11 sectors fell.

Early Friday morning, a global tech outage caused disruptions for businesses, governments, and financial institutions, contributing to the weekly decline. Despite its losses in the second part of the week, the Dow finished in the green.^6,7,8

Upbeat Economic Data

Although stocks were under pressure, some investors saw “green shoots” in a few economic reports. Housing starts rose 3 percent in June. Building permits also ticked higher during the month. Retail sales were unchanged in June, which was better than expected. Investors were encouraged that consumers were still spending despite ongoing inflation.^9,10

Source: YCharts.com, July 20, 2024. Weekly performance is measured from Monday, July 15, to Friday, July 19. TR = total return for the index, which includes any dividends as well as any other cash distributions during the period. Treasury note yield is expressed in basis points.