Keep Calm and Carry On
by Allan, COO of Medallion. XLN
The past 6 months have been a rollercoaster…to say the least. As a country, we have struggled with the Omicron variant, supply chain issues, a rising housing market, remote work, and an armed conflict in Europe. These issues by themselves are harbingers for a poorly performing stock market. Collectively, they can create chaos. When I look at the markets, they have actually been able to weather these storms quite well. My belief is that investors have become accustomed to these types of events and how they can influence the markets, and many of them will stick to their long-term investment strategies. So does this mean that more knowledgeable investors seem to help stabilize the markets? Here is how some of the major indices have performed in the past 6 months (as of 2/23/22):
Dow Jones: -6.16%
S&P 500: -4.61%
In contrast, some of the largest cryptocurrencies have significantly underwhelmed in the past 6 months:
Bitcoin: -21.86%
Ehterium: -19.87%
In my research, many investors are buying cryptocurrencies because of FOMO (Fear Of Missing Out). Right now, retail platforms have not fully embraced the use of these currencies, so people are just buying them to fill out their portfolios and when bad news hits the wire, novice investors, like myself, tend to pull out. So how can this market become stabilized? I know this for sure...once I can use these currencies to buy my kid that G.I. Joe with the Kung Fu Grip, that’s when this market will really take off!
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