As we enter the last four months of 2023, I’m reminded that this time last year was not so pleasant. September 6, 2022, the S&P closed at 3,908 on its way south to the low of the year on October 12 of 3,577. We were fielding a few worried calls. What made matters worse was that the asset class in our portfolios, which is designed to be the ballast, Fixed Income Bonds, also had their worst year in decades. (Bond prices and rising interest rates are inversely correlated.)
But markets like 2022 are where real money is made. Market downturns like CY2022 are opportunities to buy the best companies in the world (even in the history of the world) at significant discounts. And the icing on top of those share-price discounts, the company dividends were increasing—up about 11% in 2022. In most of our accounts, we’re reinvesting them. So we buy or hold companies selling at a discount, reinvest our dividends into more shares of those companies, and voila, we have a great year in 2023. Read More