Why Optimism Is the Rational Choice

Optimism isn’t just an attitude. For long-term investors, history gives us compelling reasons to be optimistic.

Since 1926, U.S. stocks have produced positive returns in roughly three out of every four calendar years. Over five-year periods, stocks have increased in value 87% of the time, and over fifteen-year periods, they have increased in value 100% of the time.

The message isn’t that markets always go up. The lesson is that temporary setbacks have historically been followed by considerably more opportunities for growth and wealth creation.

Investors don’t need to predict what happens next. They need to recognize that uncertainty’s blade has two edges. The future may be worse than expected, but it may also be considerably better.

History cannot guarantee a positive outcome, but it gives a good reason to believe that optimism, patience, and a long-term perspective are more than just comforting ideas, they are rational principles backed by data.

As always, have a conversation with a professional relating to your specific goals and preferences.

-Zac