Rick Lluis , CFP - Financial Planner

I wanted to share this video about the economic policies of each US presidential candidate. If you've never seen a video by Economics Explained before, I highly recommend subscribing to learn more about the economic world.

The narrator spend the first few minutes explaining how bills get passed and then moves on to explaining the actual policies.

The Economic Policies of the 2020 Election - Trump vs Biden This video was made possible by our Patreon community! ❤️ See new videos early, participate in exclusive Q&As, and more! ➡️ https://www.patreon.com/Economics...

WHEN IS THE BEST TIME TO INVEST?

We have had a little bit of everything in 2020. We started the year with markets at all-time highs. Then the market sold off considerably. Today, many markets are back to near all-time highs.

Unfortunately, most clients lack the confidence to invest in a volatile year like this one. The following are the two scenarios we see over and over:

1. Scared to invest during a pullback

Clients may generally accept the benefits of “buy low, sell high”. But when the market begins to fall, often their first instinct is to sell.

It’s extremely difficult to forecast where markets will go with any kind of consistency. Yet, people are hesitant to invest into a falling market – a strategy that has delivered excellent results.

This is highlighted in the example below. It identifies every 5% drop for the RBC Select Balanced Portfolio. Looking back to 2000, the average return 12 months later when buying these dips is +5.9%. Importantly, this isn’t a market timing exercise. In fact, many of these 5% dips were part of larger drawdowns. But even without any ability to time the market, buying into weakness delivers strong results.

2. During Market Strength

Paradoxically, the other common excuse for not investing is that the markets are too strong. The fear in this case is that a better time to invest will arrive. Unfortunately, this can also be a mistake. Not only do markets often go long stretches without a significant pullback, but being on the sidelines during these times can be costly in terms of missed growth.

In this example, we’ve identified every all-time high for the RBC Select Balanced Portfolio – a similar situation to the one we’re in today. Looking back to 2000, the average return 12 months later when buying in these environments was still a healthy +4.5%, meaning the decision to wait for a better entry point can be very costly.

Ultimately, history shows the time-tested, successful approach is to invest regularly. By investing regularly, investors won’t miss out on attractive buying opportunities or be left on the sidelines in bull markets. It also means they don’t have to worry about timing their entry point back in -- one of the trickiest decisions to get right