Market Performance - The S&P 500 achieved a total return of 26% in 2023, followed by 25% in 2024 and 18% in 2025, reaching near its all-time high at the start of 2026 [1] - Concerns arise regarding the sustainability of this performance in 2026 due to high stock prices, fears of an AI bubble, and slowing job growth [2] Historical Context - Historically, every all-time high in the S&P 500 has been preceded by a previous all-time high, indicating that such peaks are not necessarily a sign of impending declines [4][5] - An all-time high is often a positive market signal, suggesting a bright future outlook, with new highs typically following one another [6] Investment Strategy - Investing at an all-time high has historically yielded positive returns, although the average one-year return at such highs is lower (7.6%) compared to other times (8.8%) [7] - Long-term returns (three and five years) from investing at an all-time high are higher than those from other periods, indicating that market timing is less effective for long-term investors [7] Cash vs. Stocks - The expected return from investing at an all-time high significantly surpasses that of cash or Treasury bonds, which do not provide comparable long-term growth [8] Stock Selection - Finding attractive investment opportunities at an all-time high can be challenging due to elevated valuations, with the S&P 500 forward P/E currently around 22 [9] - Investors willing to research individual stocks may uncover better values, particularly those with strong long-term growth prospects [10] Investment Vehicles - For those lacking the time or inclination to research individual stocks, investing in an S&P 500 index fund, such as the Vanguard S&P 500 ETF, is a viable option, offering low expenses and historical returns in line with the index [11] Market Outlook - While historical trends suggest continued growth for the S&P 500 in 2026, investors should remain mentally prepared for potential downturns, emphasizing the importance of time in the market over timing the market [12]