A few days ago we posted a blog post talking about the possibility of a market correction. We don't know if it's starting now or not, but we are going to see more volatility in the coming months.
The reason for this is that emerging market economies are slowing, with China being the chief culprit. Developed countries (U.S., U.K. and the Eurozone) economies are still growing. In fact, the U.S. and the U.K. are considering raising interest rates to get them back to normal.
We're six years into a surging bull market in U.S. equity markets. Bull markets usually last five to seven years. The stock market is valued above its historical average. We're due to have a correction in the stock market. Will it happen in August, September, or next year? Nobody knows.
It's important to be prepared for a correction. I'm going to talk about how we do that from a portfolio standpoint, and just as importantly, how we prepare for that emotionally.