2022 is in the past and behind us now. However, the lessons and fall out from 2022 will continue to be seen for years to come.
So what are these lessons?
The big lesson is that investing isn’t as easy as many thought it was.
Whether it was meme stocks, a massive amount of new investors opening accounts and coming into the market, the Reddit pages dedicated to trading or any other measure, we saw a massive influx of interest and participation in the market from everybody. This interest just so happened to peak in 2021 when unknowingly to us, we were just about to end one of the best periods the market has ever seen.
So 2022 came and was a reset of all of this. Where growth vs. value investing came back into the conversation, where bonds didn’t work like they were supposed to, and unless you were in cash, there was a good chance that your account value decreased over the year. Our bull-run had come to an end for now and many investors that were brand new to the markets saw something they had never seen before.
Of course, these things have all happened before and undoubtedly we will have down years in the future too. But 2022 was just a reminder of that when it felt like everyone forgot that it is bound to happen.
The truth is, investing takes patience and discipline. Sometimes, an extraordinary amount of each. And in those years, patience was low and discipline was nowhere to be seen.
We are bound to have good years in the market again, 2023 so far has been great. We are also bound to have bad years again.
The lessons we learned in 2022: investing is hard, it takes patience and discipline and a solid plan behind it all. Those lessons won’t be forgotten any time soon.