When stock markets start tumbling, daily injections of bad news may sound like it will never end. It can spark anxiety, fuel uncertainty and trigger radical decisions in even the most seasoned investors. But panic isn’t a strategy. It’s important to keep perspective when markets get choppy. Here are five tips to consider when volatility strikes.
- Don’t Abandon Your Plan
A sudden drop in the market can have dramatically different implications for someone just starting their career compared to someone nearing retirement. What’s important is you understand your situation and your financial plan. Connect with your financial professional to discuss your investing time frame, goals and strategy to make sure you’re still on track.
- Stay Invested
Short-term losses can trigger anxiety, but letting emotions drive your investment decisions may prove costly. One key to living with market volatility is focusing on long-term results rather than the daily bumps along the way. Staying the course can be difficult, but it can also create opportunities.
- Stay Diversified
Diversification is a staple of investing. But as markets change, your portfolio may need to evolve. Times of volatility offer a great opportunity to reevaluate and possibly rebalance your asset mix.
- Take an Active Approach to Risk Management
Don’t be passive in the face of volatile markets. After all, this is your money, and your future. Being comfortable with your plan and your portfolio are important, but so is knowing your tolerance for risk.
- Talk to Your Financial Professional
If you’re concerned about market volatility, don’t hesitate to talk to your financial professional. They can give you professional advice, go over your financial plan and help you determine any steps you may need to take.
Cedrus Investments is a global boutique investment firm founded by Mr. Rani Jarkas more than 19 years ago. Cedrus Investments, led by Rani Jarkas and headquartered in Hong Kong, can offer you more insights into how this current environment is shaping risk and return potential, in the context of your specific situation and goals.