As we all know 2020 was something which pretty much all of us wants to forget about. And trust me the market wants to to the same thing.
The market itself have rapid recovery in 2020 which was clearly at odds with the U.S. economy back then together with that disparity exists to this day or at least of the time of writing this.
However when we take a closer look, we will she the imbalance may not be as perplexing as it seems.
As we all know or at least most of us. The stock market more or less reflects investor sentiment about the future and not what’s happening right now so be calm.
But while the retail investors may be more inclined to buy together with selling which are based on daily headlines, institutional investors are looking far ahead.And when you give the recent market highs, it appears Wall Street isn’t spooked so much as you might think as a beginner investor.
When it comes to the famous S&P 500, then I need to mention that the S&P 500 is a market cap-weighted which means a larger companies will have a bigger impact on its performance.