A bear market in the S&P 500 could be in the cards if the Fed’s next rate hike continues.
The S&P 500 is currently hovering at a 5% annualized return, and it’s been rising for some time.
The S&X 500 is up 2% so far this year, while the Dow Jones Industrial Average is up 20%.
The Dow is up 5% so the SAC, or market average, is up 13%.
What’s behind this?
A combination of factors that could be driving up the price of stocks.
One is the ongoing market turmoil, as the Federal Reserve is running a large-scale bond-buying program that’s expected to end this year.
In the last month, the Federal Open Market Committee cut interest rates on several major currencies and lifted short-term interest rates in two other major currencies.
It’s unclear if that’ll lead to another stock market bubble or if the market just continues to rise.
Other factors could be a weakening dollar, as it was in early November.
There’s also the possibility that the Fed will continue to ease its pace of stimulus, which will likely lead to more price appreciation in the future.
Finally, there’s the risk that the Federal Housing Finance Agency will start to raise the federal funds rate, which is the federal agency that helps pay for mortgage-backed securities.
That could lower the prices of stocks in the short term, but in the long run it could make the market more expensive for consumers.
What should you do?
Investors should stay calm and keep their eye on the horizon.
If stocks start to fall, that’s good news, but if stocks keep rising, that could mean that a large number of people are losing money on their investments.
If you’re looking for a quick way to buy stocks and you don’t have a lot of cash, you can use a broker.
The most popular broker to look at right now is Morningstar.
For the most part, it’s free to subscribe, but you can also use an ETF or ETFs like BlackRock and Vanguard.
A small portion of investors use the Fidelity Advisor app, which allows them to access the FOMC’s market-moving tools.
That app is currently only available in the United States, but Fidelity is already working to expand it to other countries.