The S & P 500 has achieved 39 new highs Year to Date. Now what?

Edwin A. McKnight, LUTCF, ChFC®

July 15, 2024

Normally I like to let the Goldman Sachs Chart of the Week speak for itself. This Chart of the Week paints a positive outlook; but with the S & P 500 having 39 closing highs year to date*; I felt some commentary is appropriate.

Two years ago (July 12th, 2022), the S & P 500 closed at 3801.78** and according to the Washington Post (12/27/2022); “It is one of the 10 worst performing years for the stock index in at least 90 years.”***

As I meet with many of you, the question keeps coming up: “Shouldn’t we be taking money off the table now that the market has done so well?” Or comments like this “Markets sell off after they hit all time highs, so what should we do?”

Let me preface the following comments with this disclaimer:

I am a “the glass is half full” Advisor and as such I anticipate, that over time, market corrections, when they occur, will eventually right themselves and reward patient investors with higher valuations for their investments.

See this Morningstar article“Staying Invested Beats Timing the Market”***** for recent research.

As a reminder, past performance does not guarantee future results, you may lose money.

So this means… What exactly?

Focusing on an investor’s time horizon and otheressential facts, we followModern Portfolio Theoryand, especially in our Tax Deferred andTax-exemptAccounts;Portfolio RebalancingandPortfolio Allocation and Reallocation. ****

We do not attempt to time the market but follow the concept of staying invested.*****

Call to Action:

Life events play a major role in our Wealth Management process and the Risk Model we assign to an investor’s investment portfolio. Changes in health, family events, job status, large purchases expenses, etc.; all affect this.

If you’ve experienced a significant life event(s), please reach out to us so that, together, we may evaluate your investment portfolio considering these changes.

If you’re becoming nervous about the recent market highsor, as mentioned above, you’ve experienced events that affect your planning, please reach out to us at your earliest convenience to review your specific situation.

I look forward to visiting with you.

Edwin McKnight

^{The S&P 500 Is on Track for Most Record Closing Highs Since 1995 - Markets Insider (businessinsider.com)}
^{Finance/Yahoo Historical Data}
^{Washington Post(Originally published Dec. 27, 2022)}
^{Non Qualified, taxable accounts are treated on an individual basis with the goal of mitigating capital gains taxes, while seeking to maintain your Allocation model.}
^{Staying Invested Beats Timing the Market}

^{Challenging Intuition}

Conventional wisdom cautions against buying any security at its peak price. With that said, peaks can only be identified with the benefit of hindsight, something investors do not have at their disposal in the moment. Contrary to intuition, investing in the S&P 500 exclusively on days when the market reached an all time high has outperformed a strategy of investing on any given day, providing stronger returns on each a 1 year, 3 year, and 5 year forward basis.

^{Article from GSAM.com: Challenging Intuition (gsam.com)}

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^{Source: YCharts.com, July 13, 2024. Weekly performance is measured from Monday, July 8, to Friday, July 12.}
^{TR = total return for the index, which includes any dividends as well as any other cash distributions during the period.}
^{Treasury note yield is expressed in basis points.}

Recipe of the Week

Summer Vegetable Stir-Fry

Ingredients:

2 tablespoons olive oil
1 medium zucchini, sliced
1 yellow squash, sliced
1 red bell pepper, julienned
1 green bell pepper, julienned
1 cup cherry tomatoes, halved
1 small red onion, thinly sliced
2 cloves garlic, minced
1 cup snap peas
1 cup broccoli florets
2 tablespoons low-sodium soy sauce
1 tablespoon rice vinegar
1 tablespoon honey
1 teaspoon grated fresh ginger
1/4 cup fresh basil leaves, chopped
Salt and pepper to taste
Cooked brown rice or quinoa for serving

Instructions:

Prepare the Vegetables:
- Wash and cut all the vegetables as described.
Make the Sauce:
- In a small bowl, whisk together the soy sauce, rice vinegar, honey, and grated ginger. Set aside.
Stir-Fry the Vegetables:
- Heat the olive oil in a large skillet or wok over medium-high heat.
- Add the garlic and red onion, and sauté for about 1-2 minutes until fragrant.
- Add the zucchini, yellow squash, bell peppers, snap peas, and broccoli. Stir-fry for about 5-7 minutes, or until the vegetables are tender but still crisp.
- Add the cherry tomatoes and stir-fry for another 1-2 minutes.
Add the Sauce:
- Pour the sauce over the vegetables and toss to coat evenly. Cook for another 2-3 minutes, allowing the flavors to meld together.
Season and Serve:
- Season with salt and pepper to taste.
- Remove from heat and sprinkle with fresh basil leaves.
- Serve the stir-fry over cooked brown rice or quinoa for a complete meal.

Nutritional Benefits:

Zucchini and Yellow Squash:Low in calories, high in vitamins A and C, and provide antioxidants.
Bell Peppers:Rich in vitamins C and A, and provide a good source of fiber.
Snap Peas and Broccoli:Excellent sources of vitamins K and C, fiber, and various antioxidants.
Olive Oil:Contains heart-healthy monounsaturated fats.
Ginger and Garlic:Both have anti-inflammatory and immune-boosting properties.

This summer vegetable stir-fry is not only packed with seasonal produce but also offers a variety of vitamins, minerals, and antioxidants, making it a healthy and delicious choice.

Uncommon Health Tip For Handling Summer Heat:Use Cooling Foot Baths

Why It Works:

Feet have a high density of blood vessels close to the skin surface, which makes them an effective area for regulating body temperature. Cooling your feet can help lower your overall body temperature, providing relief from the heat.

How to Do It:

Prepare a Foot Bath:
- Fill a basin or large bowl with cool (not ice-cold) water. Adding a few ice cubes can help, but make sure the water is not too cold to avoid discomfort.
Enhance the Experience:
- Add a few drops of peppermint or eucalyptus essential oil to the water. These oils have a cooling effect and can provide an additional refreshing sensation.
Soak Your Feet:
- Sit in a comfortable chair and soak your feet in the cool water for about 10-15 minutes.
- You can do this several times a day if needed, especially after being outside in the heat.
Additional Tips:
- For an extra cooling effect, you can use a chilled gel pack on the back of your neck while soaking your feet.
- Stay hydrated by drinking water while you relax.

Benefits:

Quick Cooling:Provides immediate relief from overheating.
Improved Circulation:Helps improve blood flow and can reduce swelling in the feet.
Relaxation:A calming activity that also helps reduce stress.

By incorporating cooling foot baths into your routine, you can effectively manage your body temperature and stay comfortable during the hot summer months.

"Do not merely practice your art, but force your way into its secrets; it deserves that, for only art and science can exalt man to divinity."

– Ludwig van Beethoven

Give Back To Your Community By Working As A Tax Volunteer

If you're looking for a way to give back to your community and help people with low-to-moderate incomes, consider applying to volunteer with the Volunteer Income Tax Assistance or Tax Counseling for the Elderly programs. These programs offer free tax help to senior citizens, persons with disabilities, and those who speak limited English to understand their tax situations.

Here are some of the perks of being a VITA or TCE volunteer:

Flexible hours:Generally, volunteers contribute 3-5 hours per week. Some sites are open all year, but most programs are open from January to April.
Convenience:Thousands of VITA and TCE sites are set up in neighborhoods across the country, so it's convenient to volunteer at a location close to home. These locations are usually community centers, libraries, schools, and malls.
No experience needed:You don't have to be a tax pro to volunteer because all volunteers receive special training and can serve in various roles.

*This information is not intended to be a substitute for specific, individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax professional.

Tip adapted from IRS.gov⁶

What To Look For On A Nutrition Label

Nutrition labels contain helpful information that can guide you in the right direction as you eat healthier. But do you know how to read one correctly? The serving size is the first thing you will see on a nutrition label; this shows how many calories a serving contains.

The following section is the nutrients. This section helps you determine a food's nutritional value. Pay close attention to saturated fat and added sugar. Lastly, you have the % Daily Value (DV), the percentage of each nutrient in a single serving in terms of the recommended amount.

Tip adapted from heart.org⁷