Intraday Market Movements Don’t Tell The Whole Story
by Financial Design Studio, Inc. / September 6, 2018
Spoiler alert: READ TO THE END! How many times have you watched a movie, read a book, or just experienced something in life that turned out so different in the end than what you were anticipating? This is very similar to what we are experiencing in the market over the past week and days. In the market we call the changes throughout the day intraday price movements.
If you read the news in the middle of the day you have likely seen headlines big market movements. Perhaps you didn’t check back at the end of that day. So in your mind the market was down that amount for the day. However, in reality the market actually performed better after you were looking and closed the day flat or even higher.
Below is a chart to better demonstrate these moments. You’ll notice the ends of the green arrow show the opening and closing prices for the index on given days in the last month. Then notice by the circled areas how in between the opening and closing prices the market moved lower or higher, some days more drastically than others. If you’re staying invested for the long term it’s the closing price for the day that will tell you the end of the story. Be sure that if you’re worrying about the markets big swings you also pay attention to the closing price of the day, not just during the day.
We anticipate more days like the past week in the coming months. With several factors such as global trade tension and upcoming midterm elections the market will likely see more volatility ahead. We expect the volatility but also see potential progress for the market ahead too. As always, if the volatility starts to make you uneasy be sure to let us review for changes to your portfolio that can be made to ease your mind. We want you to have a positive end to your day too!
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