Stock Market Analysis Today – ‘No cause for alarm’: Investment manager explains dip in stock market

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Stock Market Analysis Today – ‘No cause for alarm’: Investment manager explains dip in stock market

Allison Investment Manager Partner David Allison said the recent dip in the stock market is normal (Photo: Sydney Bouchelle/WWAY)

WRIGHTSVILLE BEACH, NC (WWAY) — The stock market took a dip on Monday, landing at about 3-percent at its lowest. What does this mean for average investors?

“That’s kind of normal stock market volatility, really,” David Allison said. “We haven’t had a five-percent plus drop off the top in the market since last October.”

Allison, vice president and partner at Allison Investment Management, said drops like this are typical. What’s more unusual is how calm the market has been in the past year.

“You know, five-percent corrections a couple of times a year, a ten-percent correction about every two years, that’s a pretty normal market environment,” Allison said. “This volatility we’ve had recently, while it doesn’t feel normal because we’ve had such a smooth ride up in the last couple of months, it is.”

Allison said the last dip the market has seen like this was in October of 2020. This could be because investors were more willing to take risks and the reopening trade.

“Interest rates are nice and low so that’s kind of providing some in-flows into stocks which have pushed prices up so that definitely has helped, you know, the stimulus,” Allison said.

Experienced investors are familiar with these kinds of corrections and those who are new to the game should get used to the trends.

“A little five-percent correction in stocks, shouldn’t be anything to alarm anyone,” Allison said. “If it does alarm someone they should take a look at their allocations of stocks and rethink it because in a normal environment you’re going to get those types of corrections a couple of times a year.”

For a little more reassurance, the market is up 16-percent for the year to date.

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 Stock Market Analysis Today – ‘No cause for alarm’: Investment manager explains dip in stock market