Astra 3rd Quarter Commentary

Below is our commentary that went out with our 3rd Quarter reports:

Any decline in the stock market is often accompanied by dire newspaper and news headlines, often with words like turmoil or crisis. But a more accurate word would be Normal.

There is no exact reason for the current decline but it seems the downturn is an accumulation of several factors:

-Mounting concerns over China

-Weakening commodity process (oil and others)

-Interest rate fears

It might not feel like it, but this latest market correction is a typical event, especially in a bull market that has lasted some six years. 

The broad trend higher has seen periodic market pullbacks since 2010.

Source: Active Trader Pro®, as of September 10, 2015.

Each market decline has been followed by even greater recoveries.  We can see in the chart above that the market works in short-term cycles but the long-term trend goes up. 

Why is that? A rising market reflects the growth of the economy and the wealth creation and increasing value of the companies that make up the market. 


I am sure you can hear me saying, “The price of your funds may change and vary in the short term, but the value of your fund is the main focus.”  


“Price is what you pay, value is what you get.”  -Warren Buffet


Patience.  This is the challenging part.  It is tough to stay calm when we live in a world of 24-hour news cycles amplified through social media.  Tuning out the noise is difficult when the noise is seemingly everywhere.

Be confident that your investments are diversified.  This is a key principle in investing, and it reflects the practice of spreading your investments among the different asset classes.  We have worked together to ensure that your portfolio matches you and is personal to your long-term and short-term needs.

Resist the temptation of market timing.  After a decline in a market, many investors naturally want to sell to avoid the potential for further drops in their equity portfolio.  Not only does that lock in your losses, but it also raises the question of when to reinvest.  How would you know when to sell and when to buy?  There is an old Wall Street saying: “Nobody rings a bell at the top of the market and nobody rings one at the bottom.”

Take advantage of market volatility.  As I said before in my August email, I look forward to the market downturns.  The future growth in your portfolio comes not only when the market increases, but also from the disciplined understanding your fund managers are not done buying yet.  There is opportunity right now for your fund managers to continue to purchase quality, high value-based companies. 

I leave you with this:

  • Seven of every ten years the market is positive!
  • Markets go up more often than they go down.
  • Not only do markets rise more frequently, but they tend to increase with more momentum.

“This, too, shall pass.”   Attributed to Persian poet, Attar of Nishapur



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