Most investors love economic and market forecasts. With the markets so uncertain and volatile, our brain craves some sort of idea of what the future holds. But the markets are unpredictable – evidenced by the fact that no one can consistently predict them with accuracy. Of course, a certain forecast will be right from time to time, just like a broken clock. But market forecasts are not persistent or dependable, no matter what your brain tells you.

Persistent (def) – continuing to exist or endure over a prolonged period

Wall Street forecasts lack persistence. Their shelf life may only be a few weeks or months at best. 2020 was a great example; once COVID hit, existing forecasts became worthless. And this happens just about every year – excuses abound as to why the “experts” got it wrong…again.

Despite their propensity to mislead investors, forecasts are alluring because they provide an illusion of certainty. And our brain wants certainty. The problem is that we are looking for certainty in the wrong place.

Our forecast is persistent because it is based on enduring investment truths and investor behavior. The news and markets change all the time; but this forecast does not. Not only is it reliable, it’s of immense value to help investors pursue their goals.

Our 2021 Forecast

In full disclosure, this is nearly identical to our forecast for 2020 and years prior to that:

• The economy/market will do something that surprises us
• Investors who watch the market often will experience more stress than those that don’t
• You will be tempted to abandon your plan at some point based on expert forecasts and/or short-term market performance
• Investor behavior (discipline vs chasing what is hot/popular) will have a significant influence on total return – and is something in your complete control

Investing is simple, but not easy. It is difficult to stick with a strategy when it is out of favor. Patience and discipline are virtues because they aren’t easy, yet they are essential for your success. As your advisors, one of our most important roles is helping you decipher the noise from what really matters for your financial success.

We wish you a prosperous, fulfilling, and happy 2021. Thank you for allowing us to be your trusted partners along the journey.

If you’re considering working with us here at Mosaic, we invite you to learn more about who we serve and how we help them. You can also contact us with any questions you have.

By Marcus E. Ortega, ChFC, RFC | Investment Advisor Representative | CEO of Mosaic Financial Associates & Orthopaedist Advisory Group | Securities and advisory services offered through Cetera Advisors LLC, Member FINRA/SIPC, a broker/dealer and a Registered Investment Advisor.  Cetera is under separate ownership from any other named entity.

©2021 The Behavioral Finance Network. Used with permission.

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