When I think back on our finances for the first quarter of 2018, I have to quote Charles Dickens.
“It was the best of times, it was the worst of times.”
The good times included getting paid my annual bonus for 2017, going on a great family trip to Walt Disney World, and, ultimately, making some modest progress on our Net Worth, 529 Account Funding, and Passive Income goals.
The bad times included paying for that vacation in Florida, missing on some of our short-term financial goals, and a volatile stock market that finally reminded us equity prices don’t always go up!
Although the S&P 500 Index was down only about 1% for the entire first quarter, the market had fallen nearly 10% from its January peak by the end of March.
Market volatility was at elevated levels during the first three months of the year. To put that volatility into perspective, consider this:
The Dow Jones Industrial Average (DJIA) has been calculated since the late 19th century.
Two of the five largest daily point gains in the DJIA’s history occurred over the past three months.
And three of the five largest daily point losses in the DJIA’s history occurred during the first quarter of this year.
Fears of an all-out trade war with China have continued to spook investors in April, and it seems like we are always just one tweet away from a 500 point move in the market!