Should You Invest in 2023? Here’s Our View

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Investing is not about getting rich overnight. It’s about investing in assets you believe in and keeping them for the long term.

As I was watching a documentary on Wall Street last night, something came to my mind. The film touched on the stock market crash of 1973-1974. In the documentary, people ran around with their hair on fire and were completely panicked. My first thought was, “Wow, that didn’t affect me at all.” Granted, I was a young kid, but my parents were investors, and it seems they’d heard something about the biggest stock market drop since the Great Depression.

And I can’t let go of my thoughts, so I made a list of all the huge drops since then: the 1987 Black Monday crash, the 1999 dot-com bubble fiasco, the 2008 global catastrophe. There was a short and dramatic drop in the market due to the recession and the COVID-19 pandemic.

Here’s the gist: The market will experience a decline. Sometimes it drops significantly. This has been repeated many times since the opening of the New York Stock Exchange in 1792.

Sure, we’re dealing with the aftermath of the pandemic and hope inflation subsides, but now is not the time to panic. Now is the time to soberly consider the wisest things to do in the next 12 months.

If you are a bargain hunter

According to the raw numbers, we have exited the bear market. So why not? because, according to forbes, the market is still down nearly 20% over the past year. It’s not as bad as it used to be, but it still doesn’t feel good.

You may have heard this a thousand times, but the best time to fill your portfolio with low-priced assets is when others are too scared to stay in the market. Based on the stock market’s past performance, bear markets are followed by longer and stronger bull markets. And as those assets grow in value, you’ll want to keep them in your pocket.

For a little inspiration, consider the following facts. Stocks lose an average of 36% in bear markets. However, in a bull market, stocks are up 114% on average. There are far more bull markets than bear markets, making the odds of success even greater.

The same rules that apply during the bull market apply today.

• Buy assets that you know and fully understand.
• Maintain diversification across different asset classes to ensure that a decline in one sector does not lead to a decline in the entire portfolio.
• Don’t buy anything you don’t plan to keep for at least 10 years.

Past returns are no guarantee of future results, but as history shows, those who keep at it will be rewarded.

when you get nervous

Wall Street strategists look pessimistic, but groups such as Goldman Sachs, JP Morgan Chase and UBS Asset Management believe the economy will disappoint. It is these conflicting views that make investment decisions so difficult for many of us.

If the thought of market losses is keeping you awake, it’s okay to take it easy. For you, 2023 may be the year to invest in low-risk assets. Below are some examples of low to no risk investments.

• Certificate of Deposit (CD)
• money market funds
• Treasury Inflation Protection Securities (TIPS)
• US savings bonds
• pension

Whether the market goes up or down, the world keeps spinning.The wrong move is to act indecisive and paralyzed none Whether you believe the market will recover or you decide to accept lower returns on low-risk investments, it’s important to stay in the game.