2016 will surely be remembered as a volatile year, one where I think more and more people find themselves desperately seeking breaks of serenity.
That’s not technically the definition of volatility, but in real terms, we consider something to be volatile when it behaves in a way we didn’t expect. In my professional experience, volatility in the value of investments, and more specifically unexpected downturns, freaks people out more than anything else.
The beginning of the year saw the stock market drop 10% in a month, then recover.
In November we saw the stock market drop 5% in a matter of hours, then go up 6% the next day. On the same news.
In the months from July through December, we saw interest rates increase some 40-50%. Now they seem to have settled a bit.
In between we saw a lot of people we grew up with die. Some of an age that death was not unexpected, but many of an age that it was.
We elected a new President that, to me, embodies the very concept of volatility.
I talk a lot about preparing financially for volatility in markets and life in general in this blog (https://quantumleapcapital.com/blog/2016/01/be-prepared/). It is after all a personal finance blog, and in my view, financial planning is the ongoing process of mitigating risk. But truth be told, it’s also therapy for me. Writing about the things we see in our business every week is an outlet that I find very soothing. It offers just a little bit of serenity in an age of volatility.
A friend of mine once said he thought it was in my nature to seek volatility. That made me stop and think. He may well have been right, and then again that may be true of us all. While always unsettling, volatility can breed opportunity. But only if you’ve reserved some energy, capital, and emotional resolve well enough in advance.
I’d like to tell you I think the ride on markets and the economy will be smoother this year. But I don’t think it will be. To the contrary, something tells me our natural ability to adapt will lead to ever increasing volatility.
Whatever may come, we at Quantum Leap Capital would like to help you find those much-needed breaks of serenity.
We wish you and yours a happy, healthy, prosperous, and serene 2017.