Investing can be a rollercoaster ride, and market volatility can be especially nerve-wracking for those who are new to the world of investing. Especially so in this day of non-stop media, where things change so quickly. It's natural to feel a sense of "FOMO" (fear of missing out) during periods of market volatility, but it's important to resist the urge to make emotional and hasty decisions. In this post, we'll explore some strategies for staying calm and investing with confidence during times of market volatility. Remember our posts are to inform, not instruct. Always talk to your financial professionals before making decisions. You can Schedule a FIT Meeting with us at any time by clicking that link and booking directly with the advisor if you don't have representation or are interested in working with our team. Our team is waiting to hear from you, and the FIT meeting will help us understand what is right for your needs.
One of the most important things to remember during times of market volatility is the focus on the long-term. The stock market has historically provided strong returns over the long-term, but short-term fluctuations are normal and expected1. By staying focused on your long-term goals, you may avoid getting caught up in short-term market movements.
Another important strategy for navigating market volatility is to stick to your plan. L2 Advisors provides clients with a proprietary planning process that generates a dynamic plan which adapts to your changing life needs. Regular meetings make sure you and your advisor are in consistent communication about your plan, as well as things that happen in your life. That plan is important, and it's also important during times of market volatility to remember how your plan affects your long-term goals. Making hasty decisions based on short-term market movements may derail your long-term plans and lead to poor investment decisions.
Diversification is a key strategy that your advisor may consider when assessing reducing risk in your investment portfolio. By spreading your investments across different asset classes and sectors, you may reduce the impact of any one stock or sector on your overall portfolio. This can help reduce the impact of market volatility on your investments.
It's important to stay informed about market movements, but it's equally important not to overreact to short-term news or trends. Remember that the stock market is influenced by a wide range of factors, including economic indicators, geopolitical events, and company-specific news. By staying informed but maintaining a long-term perspective, you should avoid making emotional and hasty investment decisions.
Navigating market volatility can be challenging, but by focusing on the long-term, sticking to your plan, diversifying your portfolio, and staying informed without overreacting, you can invest with confidence and pursue your long-term financial goals. It's important to resist the urge to make emotional and hasty investment decisions during times of market volatility. Instead, stay focused on your long-term goals and work with a financial advisor to create an investment plan that is tailored to your unique needs and circumstances. Remember, this information is intended to help you feel informed, but is not investment advice. If you're new to investing, consider reading a post on that topic, it's about a 10 minute read.
If you’re ready to work with L2 Advisors, contact us today, our office is conveniently located 5 minutes from the Gerald R Ford Airport, and 2 minutes from the nearest highway in Grand Rapids, MI. We look forward to meeting with you! You can Schedule a FIT Meeting with us at any time by clicking that link and booking directly with the advisor. Also feel free to give us a call or respond to this email.
Citation: 1 https://www.cnbc.com/2018/03/09/dont-let-stock-market-volatility-scare-you-out-of-the-market.html