The second column of this table depicts these significant recent moves.  However, when incorporating data from longer time periods, the returns begin reverting towards our long-term assumptions.  As uncomfortable as these periodic pullbacks may be, they are normal – even “helpful” since they dampen unrealistic expectations.  During a much longer period (1984 to 2023), the S&P 500 Index average annual return was 11.3%.  Although that implies investors expected similar/consistent 11% annual returns, there were only three years in which the Index returned between 9% and 12% during this period.  Volatility is much easier to tolerate when you expect it.  We also note the last line of the above table showing the periodic returns of the Aggregate Bond Index.  During the recent period of volatility, fixed income investments were relatively resilient and benefitted from declining interest rates.  As the market begins to price in the lowering of short-term rates, bonds of all maturities have rallied.  The Fed has historically used its powerful tool of monetary policy adjustments, such as lowering the Fed Funds target rate, to counter potential economic slowdowns.  We expect the Fed to continue this practice and advocate continued actively managed fixed income portfolios for most investors.