March Madness is upon us and we have already seen many underdogs coming out of nowhere to upset the perennial powerhouse college basketball programs. If you filled out a bracket, like many of our clients in our annual Oak Street Advisor's Bracket Challenge, then I'm sure you've been somewhat frustrated with this year's tournament, as it has been chaotic and more unpredictable than in many years in recent memory.
Just like this crazy tournament, the stock market can sometimes feel chaotic and unpredictable. Remember in January when some pundits were claiming another global financial meltdown was fast approaching as stocks slid lower and lower almost every day? The S&P 500 has now increased by 13% in the 5 weeks since the year's low on February 11th. Which actually puts the market UP for 2016.
So just as we understand that each year during March Madness there will be chaos and unpredictability, we must keep the same mindset when it comes to our investments. No one can predict what will happen in the future, but we can certainly count on it being unpredictable, and sometimes chaotic.