Uncertainty Is Rising — That’s Not Necessarily a Problem

In our Monday Morning Kickoff last week, we said that uncertainty doesn’t force our hands.

Here at Stock Picker’s Corner (SPC), we follow the storylines shaping the world, which leads us to the best companies offering the biggest profit opportunities. Our holding periods typically last for years but can run for a decade or longer to let those opportunities fully materialize.

That approach is a key strength of the SPC strategy.

So while it’s never pleasant to see paper losses or a large gain start to shrink, our long-term philosophy helps us navigate through short-term volatility and stretches of uncertainty.

That uncertainty picked up steam last week, as the Dow Jones Industrial Average entered correction territory, typically defined as a pullback of 10% or more from a recent high.

While unsettling, it’s also worth taking a step back and looking at what history has told us about previous corrections.

Since 1974, there have been 27 market corrections, according to Charles Schwab.

Only six of those turned into an actual bear market, which is defined as a drop of 20% or more. Viewed another way, 78% of the time, corrections don’t turn into bear markets.

That doesn’t mean we couldn’t have a bear market here. But history suggests corrections offer buying opportunities, which highlights the strength of our Farm Team.

This is where we “scout” companies, much like a major league ball club that evaluates promising prospects in the minor leagues.

One of our Farm Team companies has been off to a hot start since we began our coverage, rising more than 100% since July 2024.

But it’s cooled off recently.

The irony is that this company’s most ambitious phase — its transformation into an “all-in-one investment app” — is unfolding while investor attention drifts elsewhere.

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