In late July, the stock market once again reached all-time highs, pushing higher despite ongoing concerns and unsettling headlines. Some observers are speculating that the market is overheating, pointing to isolated “bubble-like” areas. Margin debt has also hit a record, adding fuel to the narrative that markets are stretched and “due” for a pullback.
It’s natural to feel uneasy when markets climb steadily. After all, we know nothing lasts forever. The thought creeps in: Is the market overdue for a decline?
The “Due for a Change” Mental Shortcut
This belief is a common mental shortcut. Consider flipping a coin: if it lands on heads three times in a row, many of us feel that tails is “due” next—even though each toss is independent. We unconsciously apply this same thinking to markets: after a series of highs, we may expect a low to follow soon. But history tells a different story.
What the Evidence Shows
Since 1950, data reveals that investing at market highs has actually led to higher average future returns compared to investing at other times.[1] The same surprising outcome holds true going all the way back to 1926.[2] Markets reach new highs regularly, often despite crises, uncertainty, and negative forecasts, and they tend to keep rewarding disciplined investors over time.
Feelings vs. Facts
Intuition is powerful, but it’s not always reliable. New highs aren’t a warning sign. Your investment strategy should be guided by facts and a well-designed plan, not fleeting impressions or market chatter. That’s exactly what I’m here to help you do. Fighting the brain’s natural impulses isn’t always easy, but it’s often essential to making decisions that truly serve your long-term best interests.
– Jonathan
[1] A Wealth of Common Sense, Investing a Lump Sum at All-Time Highs, July 4, 2025
[2] Schroders, Scared of investing when the stock market is at an all-time high? You shouldn’t be, July 25, 2025