What Can We Expect in 2017?  Answer: The Unexpected

January 9, 2017  |  

What Can We Expect in 2017? Answer: The Unexpected

What will 2017 hold for the markets? About this time every January, news outlets, economists, fund managers and other pundits flood the media with their predictions about what the market will do in the year ahead. Bold predictions abound regarding anticipated interest rate movements, the direction of the S&P 500 index and the global economy, thus fueling optimism or fear—sometimes both–for the average investor.

The NY Times published an interesting article in December 2016 regarding Wall Street’s past predictions and market predictions for 2017.  It looked at predictions from different firms dating back years, do you know what they found?  The forecasts are often wrong, historically wrong.  There is a tendency for Wall Street firms to be bullish with their predictions, often creating a false sense of optimism among investors regardless of actual returns.  On top of that, many firms will update their forecasts as the year (and market) progress.  This constant updating makes it difficult for the public to recall the firm’s original forecast.  In a nutshell, these yearly forecasts are completely useless.

Predicting the market’s direction has confounded experts for centuries, but in our digital age, with a 24/7 news cycle, we need more and more content to fill the news hole so “experts” are never going to stop making forecasts.  However, for the average investor, basing your investment and retirement decisions on such opinions and forecasts is a recipe for disappointment.

If you insist on basing your investment strategy on predictions, an article by Jim Parker of Dimensional Fund Advisors is a great starting point.  A few examples of Jim’s predictions:

1.  Markets will go up some of the time and down some of the time.

2.  Parts of your portfolio will do better than other parts.  We don’t know which.

3.  There will be unexpected news.  Some of it will move prices.

Obviously these are tongue-and-cheek predictions, but that’s the point.  No one knows exactly what the markets will do in 2017 – the only certainty in 2017 is that things will be different than they were in 2016.

As we have posted in the past, the best investment strategy continues to revolve around a disciplined, cost-sensitive, broadly diversified portfolio. This strategy allows you to create a portfolio that you can live with, year in and year out, as your needs, life-stage and risk tolerance changes.

We wish you a very happy and successful New Year. For more information about our investment philosophy, please visit our Evidence-Based Investing Center or feel free to email me with questions.



Registration with the SEC should not be construed as an endorsement or an indicator of investment skill, acumen or experience.  Investments in securities are not insured, protected or guaranteed and may result in loss of income and/or principal.  This communication may include opinions and forward-looking statements.  All statements other than statements of historical fact are opinions and/or forward-looking statements (including words such as “believe,” “estimate,” “anticipate,” “may,” “will,” “should,” and “expect”).  Although we believe that the beliefs and expectations reflected in such forward-looking statements are reasonable, we can give no assurance that such beliefs and expectations will prove to be correct.  Various factors could cause actual results or performance to differ materially from those discussed in such forward-looking statements.  Historical performance is not indicative of any specific investment or future results.  Views regarding the economy, securities markets or other specialized areas, like all predictors of future events, cannot be guaranteed to be accurate and may result in economic loss of income and/or principal to the investor.  Investment process, strategies, philosophies, allocations and other parameters are current as of the date indicated and are subject to change without prior notice.  Nothing in this communication is intended to be or should be construed as individualized investment advice.  All content is of a general nature and solely for educational, informational and illustrative purposes.  Any references to outside content are listed for informational purposes only and have not been verified for accuracy by the Adviser.  Adviser does not endorse the statements, services or performance of any third-party author or vendor cited.

Share this post

About Patrick Melvin Jr.

Patrick D. Melvin Jr., is a Wealth Manager at Independence Advisors, LLC. Pat models client’s financial plans and works with the firm’s clients on financial planning areas such as retirement planning, investment planning and estate planning. CLICK HERE TO ASK PAT.

Get Free Updates

Enter your email address to receive our weekly updates! (we respect your privacy)

advanced-degrees cells curriculum faith faith-formation high-school-choice neumann-scholars quality-education recommend resources scholarship stream student-device student-retention visit activities student-life admission class-pages
%d bloggers like this: