The stock market has increased by about 1% over the last month. The steady climb higher was interrupted on October 10th due to China tariff concerns. The market fell almost 3% on the 10th of October. We have gained back most of those losses in the last week.
The S&P 500 is now up almost 13% for the year and the Nasdaq is now up about 17% in 2025 – despite the 19% drop during the tariff announcements in April.
In the chart below you can see the extreme price volatility in April and the steady move higher over the last five months.
We are not receiving timely inflation or jobs data due to the government shutdown. The market is expecting two more rate cuts from the Fed before the end of the year. AI spending continues to drive economic growth in the US.
The steady and consistent increases in stock prices are a cause for some concern. My valuation gauge indicates that the stock market (S&P 500) is now about 25% above its fair market value in late October. This is higher than we were in January 2022 just before the 2022 bear market. The last time the market was overvalued by this much was in 2000 during the dot-com bubble.
I do not trade based on market valuation levels and you should not either. It is just a reminder that you need a strategy in place to protect your savings in case we experience a bear market. Older investors in particular need loss protection.
Stay Disciplined My Friends,
Phil
Disclaimers The Beyond Buy & Hold newsletter is published and provided for informational and entertainment purposes only. We are not advising, and will not advise you personally, concerning the nature, potential, value, or suitability of any particular security, portfolio of securities, transaction, investment strategy or other matter. Beyond Buy & Hold recommends you consult a licensed or registered professional before making any investment decision.
Investing in the financial products discussed in the Newsletter involves risk. Trading in such securities can result in immediate and substantial losses of the capital invested. Past performance is not necessarily indicative of future results. Actual results will vary widely given a variety of factors such as experience, skill, risk mitigation practices, and market dynamics.
I work with many retirement investors who have saved enough money to retire comfortably.But many of those same people worry so much about their finances that they don’t enjoy their golden years as much as they should.
People with a retirement nest egg of over $1 million should be able to coast through retirement without financial worries. In many cases, they could even enjoy a higher income in retirement than they had while working.
Yet rather than coasting, many find themselves constantly stressed about their finances. The main reason for this is their ineffective investing strategy.
The fear of stock market meltdowns causes some retirees to invest too conservatively, which reduces their investment income. Conservative investors may avoid big market declines, but they end up worrying about not having enough income.
Others lean heavily into stocks to boost returns but lack a strategy to handle those inevitable bear markets. These more aggressive investors constantly check the market and live in fear of seeing their savings wiped out.
As most of you know, I created a better way to invest—one that gives retirement investors the best of both worlds: high investment returns with built-in protection against large losses in bear markets.
I often talk about the financial benefits of my system, but my main goal is to eliminate financial stress in retirement. When investors are confident about their gains and know their money is protected during downturns, they can truly enjoy retirement.
There’s no need to check the market every day if you have a rock-solid strategy. My system automatically and continuously monitors the market to determine the optimal investment positioning at all times. A computer executes this process, using a model I designed—but the system itself is fully automated.
A very wise investor once said, “Invest based on what you see, not what you think.”My system relies on actual market price data rather than assumptions or opinions. The markets are often irrational in the short term—nobody can consistently predict what will happen next week, next month, or even six months from now.
However, over the long term—five, ten years or more—markets behave rationally. My system is built on that long-term consistency while adapting to short-term trends to avoid getting crushed in bear markets.
I originally built this system for my own investing. I didn’t want to spend my retirement stressing over volatile financial markets.
Following Warren Buffett’s advice to buy the best funds (like the S&P 500 and Nasdaq-100) and to simply hold them through bear markets doesn’t work for retirees. A severe bear market in your 60s or 70s can destroy your retirement plans.
Traditional asset allocation approaches recommended by financial advisors don’t provide enough income—and they don’t protect well enough against large losses.
Stock picking or market timing based on perceived trends doesn’t work either. Those methods require hours of daily attention, and even then, few investors can outperform a simple S&P 500 index fund over the long haul. Short-term luck happens, but your investment strategy should never depend on luck.
I know this because I’ve tried all of these approaches—and I’ve researched the data. This isn’t opinion; it’s fact. You can check the numbers yourself.
I use my system to invest all of my own money because I’ve never found anything better.
Having complete confidence that my system can deliver average long-term returns between 13% and 15% per year—while protecting against major market losses—allows me to eliminate financial stress in retirement. My automated system does all the monitoring and trading for me.
This is what I want for you.
Your retirement will be so much better when you have higher income—and even more enjoyable when you don’t have to worry about your money.
It usually takes people a year or two of using my investment system to build the same confidence I have. That’s completely understandable. But once they reach that point, it’s an incredible relief. It’s liberating.
I don’t just want you to have more money. I want you to have a better life.
Stay Disciplined My Friends,
Phil
Disclaimers The Beyond Buy & Hold newsletter is published and provided for informational and entertainment purposes only. We are not advising, and will not advise you personally, concerning the nature, potential, value, or suitability of any particular security, portfolio of securities, transaction, investment strategy or other matter. Beyond Buy & Hold recommends you consult a licensed or registered professional before making any investment decision.
Investing in the financial products discussed in the Newsletter involves risk. Trading in such securities can result in immediate and substantial losses of the capital invested. Past performance is not necessarily indicative of future results. Actual results will vary widely given a variety of factors such as experience, skill, risk mitigation practices, and market dynamics.
Anyone who invests in financial products is forced to wrestle with the balance between risk and reward. Most people understand this, but nobody ever spells out exactly what it means for you in dollars and cents. My goal is to do that for you today.
Stocks offer the potential for large gains. For example, investors who bought Nvidia just two years ago have seen their shares rise nearly 300%.
However, stocks can also experience periods of severe losses. During the dot-com crash in the early 2000s, technology stocks lost more than 75% of their value.
Bonds, on the other hand, typically offer lower returns with lower risk. Over the long run, bonds tend to produce annual returns of 3% to 4%. While bonds can lose money in the short term, their declines are generally smaller than those seen in stocks.
Individual investors have always faced this tradeoff between risk and reward. For retirees or those nearing retirement, the stakes are even higher. Large losses in your 60s or 70s can devastate your retirement plans.
Since most investors have realized that buying individual stocks rarely works out, the focus has shifted to balancing risk and reward through mutual funds or ETFs. Investment professionals typically guide clients toward a mix of stock funds and bond funds.
But the range of available options—and the potential outcomes—remains limited. Here’s how the typical choices break down:
Investor Type | Stock/Bond Mix | Avg. Annual Return |
Zero-Risk Investor | 0% / 100% | 3.0% |
Low-Risk Investor | 30% / 70% | 4.8% |
Moderate-Risk Investor | 50% / 50% | 6.0% |
Higher-risk portfolios (e.g., 70% stocks) can increase returns, but most retirement investors avoid them because the potential for large losses is simply too great. Let’s now look at the downside risk for these typical investment choices.
Investor Type | Stock/Bond Mix | Avg. Annual Return | Typical Losses |
Zero-Risk Investor | 0% / 100% | 3.0% | 0% |
Low-Risk Investor | 30% / 70% | 4.8% | -12% |
Moderate-Risk Investor | 50% / 50% | 6.0% | -20% |
This table highlights why many retirement investors are frustrated. The no-risk option doesn’t keep up with inflation. The moderate-risk portfolio delivers only modest returns of about 6% annually, while still exposing investors to potential 20% losses during bear markets.
As a result, most people settle for the low-risk option—earning roughly 4.8% per year with more manageable drawdowns of around -12%.
The problem is that earning only 5% annually often leads to a tight retirement budget.
To illustrate this in real terms, consider a 60-year-old retirement investor with a $500,000 portfolio who continues working and contributing until age 65.
A typical low-risk investor could expect to generate about $45,000 per year in retirement income from their 401(k).
If they tried to chase higher returns by increasing their stock exposure, they could face losses exceeding $100,000 in a bear market.
I’ve always felt these options—and their associated risks—are terrible for retirement investors. Frankly, I think the investment services industry is one of the worst industries in the world. Is this really the best they can do?
I wasn’t willing to accept these poor choices. Over several decades of research, testing, and refinement, I developed a smarter investing system—one that delivers the same risk level as the low-risk option (around 12% potential short-term loss), but with much higher returns of 13% to 15% per year.
Here’s how that changes things for our retirement investor example:
Low Risk Investor vs. My System
Low Risk Investor | My System | |
Account Balance at Age 60 | $500,000 | $500,000 |
Stocks/Bond Mix | 30% / 70% | 90% / 10% |
Annual Return % | 4.8% | 14% |
Annual Retirement Income | $44,900 | $124,900 |
Total Retirement Income | $1.3 million | $3.7 million |
Potential Loss % | -12% | -12% |
Potential Loss $ | -$60,000 | -$60,000 |
For the same nominal risk (short-term loss of -12%), this investor could enjoy $80,000 more per year in retirement income—78% higher—which translates to an additional $2.4 million over a 29-year retirement.
To learn more about how my Market Cycles system works, Click here.
Stay Disciplined My Friends,
Phil
Disclaimers The Beyond Buy & Hold newsletter is published and provided for informational and entertainment purposes only. We are not advising, and will not advise you personally, concerning the nature, potential, value, or suitability of any particular security, portfolio of securities, transaction, investment strategy or other matter. Beyond Buy & Hold recommends you consult a licensed or registered professional before making any investment decision.
Investing in the financial products discussed in the Newsletter involves risk. Trading in such securities can result in immediate and substantial losses of the capital invested. Past performance is not necessarily indicative of future results. Actual results will vary widely given a variety of factors such as experience, skill, risk mitigation practices, and market dynamics.
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