As we ring in 2018, the stock bull market that started in 2009 continues. The extended length of this bull market (close to historic levels) has caused some people to become concerned about a correction, which leads to considering moving more of their portfolio into bonds. Generally, bonds can be a good diversifier and lower the volatility of a portfolio when added to the asset allocation.
As we have discussed in previous blog posts, we are in an historically long bull market. The current market recovery started roughly March of 2009 and now continues into a 98th month. Given that the average bull market lasts somewhere around 48-60 months, this one is well above the norm for length. Does this mean that a bear market is imminent? Not really.
For the first couple of months of 2017, the market’s “Trump Rally” continues and it seems as if all major market indexes reach new highs on virtually a daily basis. What is somewhat surprising is that we have continued robust market growth, but without the volatility that usually comes along with a growth spurt of this magnitude.