Keep Perspective During Market Volatility

10/26/2022 Written by: Ryan Neff

Every time there is a decline in the market, the scare tactics return, using fear to convince investors that the sky is falling and the market won’t bounce back – that somehow, this time is different. But the truth is, the market is always different and always comes back. It came back from the Great Depression, Savings and Loan scandal, Tech bubble, and, most recently, The Great Recession.

Investing requires riding out the ups and downs. And investors – anyone who commits capital with the expectation of receiving financial returns – need to understand that volatility is part of the investment experience. It may feel like we’re facing one market crisis after another, but keep these tips in mind:

  • Volatility is a matter of perspective.
  • Don’t let bad days blind you to good days.
  • While investing in the stock market has its ups and downs, the longer an investor stays invested, the less significant those bumps in the road appear.
  • Volatility is much easier to tolerate when you expect it.
  • The markets have been positive more often than not.

Various investment vehicles exist to accomplish financial goals, including stocks, bonds, commodities, mutual funds, exchange-traded funds (ETFs), options, futures, foreign exchange, gold, silver, retirement plans, and real estate. If market volatility makes you uncomfortable, a financial professional can help you analyze opportunities from different angles to identify investments in your portfolio that specifically seek to help minimize volatility—without abandoning growth-oriented investments.

If you can put aside the day-to-day discomfort of market volatility, it could provide an opportunity for higher returns. While trying to time the market is ill-advised, investing during down markets is precisely in line with the old financial adage “buy low, sell high.”

No one can predict if the market will go up the rest of the year or down the rest of the year. Some may guess and get it correct, but there’s no correlation for them to get it right consistently. Although volatility is an inevitable part of your investing journey, the financial professional at AssuredPartners Investment Advisors can help you keep volatility in perspective and your goals within reach.

Source: “10 Things You Should Know About Stock Market Volatility,” Hartford Funds

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