- Financial journalists periodically stoke investors’ record-high anxiety by suggesting the laws of physics apply to financial markets—that what goes up must come down.
- But shares are not heavy objects kept aloft through strenuous effort. They are perpetual claim tickets on companies’ earnings and dividends.
- If stocks have a positive expected return, reaching record highs with some frequency is exactly the outcome we would expect.
Read the full article by Dimensional VP Weston Wellington, “All-Time High Anxiety” HERE.
Investors should treat record high prices with neither excitement nor alarm.
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