Market Volatility

This month we have seen an increase in volatility in the stock market. The VIX Index (CBOE Volatility Index) which measures market volatility has increased substantially which usually occurs when we have uncertainty in the markets.

The issues that plague the market currently are the continued rise in unemployment, the recent slow down in real estate sales, and the sovereign debt problems with Greece. Not to mention the newly revised health plan from our president which caused the market to react and become volatile because the stock market hates uncertainty.
Though the market continues to be volatile, my advice to my clients is that for whatever you have got invested in the stock market, stay invested. If you have a longer term horizon, possibly buy on dips. Stay with the notion of higher inflation and the increase in commodity prices and invest in hyper growth areas like China. If the Federal Reserve monetary policy changes drastically we will review our commitment to the stock market.