Recovery May Be Prolonged

Even if the stock market bottomed last Friday,that is no assurance it will bounce back to its peak anytime soon.As of the opening bell this morning,the market was down 34% from its peak just over a year ago.Past stock market crashes have dragged on for more than a decade.The 1929 crash wasn't erased until the mid-1950s.The aftereffects of Japan's 1990 crash continue to this day.And the bear market of 1967 didn't resolve until 1982.Volatility can roll on and on,discouraging all but the hardiest investors.On the other hand,even if this is a prolonged recovery,that doesn't mean your portfolio will take that long to recover.Only if you invested all your money at the peak of the cycle would you have to wait decades to be made whole.Your portfolio's recovery will most likely be staggered, if you invested in many positions over a number of years.The market fell 40%,but your portfolio didn't,if you built it up over time,entering the chart at various points.There are also dividend payments that your portfolio accrues while the market climbs back up.Things may not be as bad for you as the media are portraying.

Market Recovery Complete

As of the closing bell on April 16,the stock market had fully recovered from its February 27 correction.Indeed,the S&P 500 index stood at a six and a half year high.According to Jason Trennert,Chief Investment Strategist of Strategas Research Partners,the economic fundamentals are the same as they were at the end of February.Interest rates are stable,and many companies are supporting stock prices by buying back their own shares.Serat Sethi of Douglas C. Lane Associates remains cautious,however.He advises a broad-based allocation to protect against risks which many may have already forgotten about.