Advisors Don’t See a Market Crash in 2024 (2024)

FAQs

Advisors Don’t See a Market Crash in 2024? ›

According to the latest InspereX Pulse Survey of 487 financial advisors, the majority (78%) of advisors are bullish about the S&P 500 and expect it will deliver more upside by the end of 2024.

While many experts are making predictions about whether the market will crash in 2024 or how severe the next downturn will be, it's impossible to say with certainty where stock prices will be in the short term. However, the market's long-term performance is all but guaranteed to be positive.

He or she will help you construct a portfolio that gives you a good chance of reaching those goals, based on the best research available. But even the best financial advisors are at the whim of the market. Most professional investors who try to beat the market actually underperform it over a given time period.

Less than 10% of active large-cap fund managers have outperformed the S&P 500 over the last 15 years. The biggest drag on investment returns is unavoidable, but you can minimize it if you're smart. Here's what to look for when choosing a simple investment that can beat the Wall Street pros.

Usually, when the stock market crashes, this can halt economic growth throughout the region. This means that the government may choose to reduce spending, companies may not have access to funding for expansion or operations, and investors may run into many losses on their open positions.

Real GDP is expected to rise by 2.4 percent year-over-year in 2024. Nonetheless, the economy is expected to lose momentum in H2 2024 as high prices and elevated interest rates sap domestic demand.

Global recession outlook

There is now a 35% chance that the global economy will enter a recession by the end of 2024, and a 45% chance that it will do so by the end of 2025.

At a recent Berkshire Hathaway annual shareholder meeting, Warren Buffett shared his thoughts on why he sees financial advisors as the worst people to trust with your money. Buffett believes that financial professionals in aggregate can't do better than the aggregate of the people who just sit tight.

Very generally, having between $50,000 and $500,000 of liquid assets to invest can be a good point to start looking at hiring a financial advisor. Some advisors have minimum asset thresholds. This could be a relatively low figure, like $25,000, but it could also be higher, such as $500,000, $1 million or even more.

How many millionaires use a financial advisor? ›

In addition, millionaires are much more likely to work with a financial advisor (69%), more than double the amount of the general population (33%).

A financial advisor is worth paying for if they provide help you need, whether because you don't have the time or financial acumen or you simply don't want to deal with your finances. An advisor may be especially valuable if you have complicated finances that would benefit from professional help.

Source: 2021 Fidelity Investor Insights Study. Furthermore, industry studies estimate that professional financial advice can add up to 5.1% to portfolio returns over the long term, depending on the time period and how returns are calculated.

Heading into 2024, investors are optimistic the same macroeconomic tailwinds that fueled the stock market's 2023 rally will propel the S&P 500 to new all-time highs in 2024.

However, several options tend to perform well or offer protection during market downturns. U.S. Treasury securities, particularly long-term bonds, are often considered a safe haven during crashes because of their government backing and tendency to rise in value when stocks fall.

Your money is safe in a bank, even during an economic decline like a recession. Up to $250,000 per depositor, per account ownership category, is protected by the FDIC or NCUA at a federally insured financial institution.

5 Year Stock Market Prediction – Economic Growth

In the next five years, the global economy is expected to grow at a modest pace. This is due to a number of factors, including the ongoing recovery from the COVID-19 pandemic, the increasing adoption of new technologies, and the growth of emerging markets.

Since 1950, the S&P 500 index has declined by 20% or more on 13 different occasions. The average stock market price decline is -32.73% and the average length of a market crash is 338 days. However, and this part is critical, the bull markets that follow these crashes tend to be strong and last much longer.

A stock market collapse typically occurs when the economy is overheated, inflation is rising, market speculation is rampant, and there is significant uncertainty about the path of an economy.

Returns in the S&P 500 over the coming decade are more likely to be in the 3%-6% range, as multiples and margins are unlikely to expand, leaving sales growth, buybacks, and dividends as the main drivers of appreciation.