What Is the Market? Why Your Definition Shapes Your Returns

The news says the market is down, up, sideways... but which market? The Dow, the S&P 500, SCHD, gold, real estate—on any given day, they're all doing something different. If you don't know which market is actually yours, sooner or later, one of the others will seduce you into a move you'll regret.

In Episode 60, Greg takes on a question that sounds almost too simple: What is the market? Using six real-world examples—from dividend ETFs to Denver office towers to SpaceX ($SPCX)—he shows how dramatically different markets can move in completely opposite directions at the same time and why investors who haven't clearly defined their market tend to react to the wrong signals at the worst possible moments.

The clearest example is SCHD, Schwab's dividend ETF. From 2022 through 2025, it lagged the S&P 500 by a wide margin in three of four years—enough to break most investors. Then 2026 hits: SCHD is up nearly 20%, and the S&P is under 9%. The investors who stayed were right all along. They just had to get comfortable with 3 years of underperformance to realize the benefit. Greg explains why that gap—between being right and feeling right—is where a lot of investors lose focus.

The same pattern runs through two 29-story office towers in downtown Denver that sold for $5 million total, while the equivalent square footage five miles away in Cherry Creek would fetch over $63 million. Or Microsoft ($MSFT), which swung from $550 to $355 to $460 to $390 in a single year while its dividend grew at 10% annually without interruption. Price and value are not the same thing—and once you know which market you're actually in, the noise from every other market gets a lot easier to ignore. 

All kinds of “markets” can work. The investors who build wealth aren't necessarily picking the best one; they're staying committed to the one that works for them.
 

Topics Covered:

 [00:11] Introduction & 5th Year Anniversary
 [03:06] What Is "The Market"? Defining the Question
 [06:04] SCHD vs. S&P 500: Four Years, Two Very Different Outcomes
 [10:00] The Three Tiers of Dividend Investing
 [12:53] Denver Real Estate: Same City, Two Different Markets
 [19:28] Gold: A Market With Its Own Rules
 [21:35] SpaceX: When Valuation Defies Convention
 [24:19] Microsoft ($MSFT): Price vs. Value in Real Time
 [27:30] Takeaway: Pick Your Battles, Win the War
 [31:34] Close: Get on the Line and Stay on the Line (GDP Eventually Goes Up)

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 📖 Free Book: Dividend Growth: The Quiet Engine of Wealth 

Dividend growth investing sounds simple, but doing it well for decades is not. That’s why we wrote Dividend Growth: The Quiet Engine of Wealth—a practical guide to building a framework you can stick with when things get uncomfortable. You can get a free copy here. 

📰 Monthly Newsletter: Observations on the Market 

📧 Questions or comments: dcm.team@growmydollar.com

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Resources:

📅 Schedule a meeting: Financial Planning & Portfolio Management
📊 Getting into the weeds: DCM Investment Reports & Models 

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Disclaimer: Past performance does not guarantee future results. Every investor should consider whether an investment strategy is right for them and all the risks involved. Stocks, including dividend stocks, are volatile and can lose money. Denewiler Capital Management may or may not have positions in the publicly traded companies mentioned herein.