Ten years ago, few, if any, could fathom that the S&P 500 would be trading over 3200 today. The 2000s were a bleak time for our markets, with the S&P’s net return for that decade being negative. The dismal decade was punctuated with the financial crisis, which saw many equity prices slashed in half. On the eve of 2010, optimism was nowhere to be found for the coming decade. Experts portended stagnating equities, sluggish job numbers, a weak dollar and roaring inflation.
Fate would prove them wrong on every front. With a few hiccups, equities have rallied almost inexorably, unemployment is at a 50-year low, inflation is nowhere to be found, and our currency is so strong that dollar-denominated debt is now strangling those emerging economies who were our envy in the 2000s. No other country came close to the prosperity America has enjoyed in the past decade. But is our growth sustainable? We are in unchartered territory, and perhaps now more than ever an investor will see the benefits of a well-diversified portfolio.
Information from TDA is not intended to be investment advice or construed as a recommendation or endorsement of any particular investment or investment strategy, and is for illustrative purposes only. Be sure to understand all risks involved with each strategy, including commission costs, before attempting to place any trade.