At the start of this past week it seemed the bears were out in force and it led to selling pressure on the indices through Wednesday. However, trading on Wednesday may have been a capitulation day as the S&P 500 Index and Dow Jones Industrial average were down nearly 3% from their respective day's high and low. The market turnaround carried through to the week's end. The only index managing to gain on the week though was the small cap Russell 2000 index which was up 2.8%. Small caps have struggled since late last year and remain down 7.0% year to date.
A number of articles in this week's magazine focus on the change in investor sentiment from bearish to more bullish. Ben Carlson, CFA, who writes for A Wealth of Common Sense, referenced a financial advice quote from Jason Zweig of The Wall Street Journal that sums up what investors should be thinking in these volatile times.
"I was once asked, at a journalism conference, how I defined my job. I said: My job is to write the exact same thing between 50 and 100 times a year in such a way that neither my editors nor my readers will ever think I am repeating myself."
"That’s because good advice rarely changes, while markets change constantly. The temptation to pander is almost irresistible. And while people need good advice, what they want is advice that sounds good."
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