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  • Writer's picture Treavor Dodsworth CFP®, CPA, CKA®

#84 - Market Recap - 2021 Q1

Market Recap - 2021 Q1

We just wrapped up the first quarter of 2021. While I don’t believe in daily checking your portfolio balance, I do believe that a high level understanding of where the market is at is beneficial.

Similar to prior posts, I am using VTI to review the US stock market, VXUS to review stocks outside the US, AGG to review the US bond market, and BNDX to review bonds outside of the US. I also added in to the chart VBR to review US small-cap value stocks.

The first chart below shows stocks, in general, have had a very good start to the year and bonds have not. The percentages are not annualized so 6% for VTI in just three months is very significant.

This next chart shows these ETFs from their lowest price in 2020 to the end of March 2021.

The stock market, in general, had a sudden decline in 2020 but then a very significant increase out of that bottom. At this point the stock ETFs (bond ETFs slightly different story) have well exceeded even the price before the crash. What can we take away from this:

  1. Fear and greed shouldn’t guide your investment decision making. It should be guided with a disciplined long-term perspective. If you didn’t allow fear to win out and sell at the bottom of the market crash, you were rewarded as the market recovered.

  2. You may think that since we just had a significant market crash in 2020 that we won’t have to worry about another one for some time. Stock prices, in general, have increased significantly beyond even where they were pre-2020 crash. By no means, am I trying to predict what will happen but if your expectation is that we are in the clear for a few years you might be disappointed. Always be mentally prepared for volatility.

To switch gears, this past weekend was Easter. While Jesus was in the tomb (the period of time between his death and resurrection), the disciples' world was shattered. Their actions recorded in the Bible portray fear and doubt (or at least misunderstanding). You may be in a season where God feels distant. Take comfort from the fact that the disciples experienced this first hand and take comfort from the fact that Easter did come.

David (the author of many of the Psalms) had many successes but also many heartaches. My encouragement is read through the Psalms as you will likely resonate with the cry of David’s heart. Psalm 59:9-10a says "You are my strength, I watch for you; you, God, are my fortress, my God on whom I can rely."


Interesting Article(s) or Video(s)

Eternal Perspective Ministries - Christ's Words From the Cross

  • Randy pulls together various quotes that reflect on the significance of what Jesus said on the cross.


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