Remember the saying “If momma ain’t happy, ain’t nobody happy”? This seems to resonate closely with investors. If the market ain’t happy, ain’t nobody happy. After a strong first quarter of the market performing higher and coming back from the end of 2018 lows investors were starting to feel more confident. With a few days in a row of the market moving lower investors might again be concerned.
There are two ways you can view the ups and downs of the market.
Are these lows actually opportunities for you to invest?
We all know when you’re investing your goal is not to lose money. However, when the market moves lower and you invest additional funds you benefit when it moves even higher again. So if you have a long time horizon for your portfolio to grow then this may be a great opportunity for you.
Are these lows actually reminders to move your portfolio more conservatively?
If you’ve already been investing for years you may feel these moves lower just make you nervous and you’re ready for a change. At the end of 2018 we had a large downward movement and it made many people consider if they needed to be taking so much risk. So when the first two months of 2019 came with a higher performance people started to move some funds away from stocks into other asset classes with less volatility like bonds or money market funds. If you weren’t honest with yourself at the end of 2018 and pretended you could stomach the volatility maybe this week was a small reminder to make some changes.
The current volatility makes us question what’s ahead? There’s an equally long list of reasons to buy and sell. So each investor has to then ask themselves some of these questions to decide if the reasons to buy and sell now tip the scale to one side. What is my goal? How long do I have before needing to use these funds? Can I sleep at night if the market is volatile? Financial advice is not a one size fits all answer like Steve showed us with his hat in this week’s video. Be sure that your portfolio is set to your situation so it’s not affecting your happiness!
Wondering how this affects your investments? Schedule a call with Michelle and Steve to discuss your portfolio today.
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