Market volatility
Something many investors find challenging is how to deal with market volatility. When the market takes a turn, it’s essential to keep a level head and make informed decisions, we outline some guidance below on how you can handle market volatility with more confidence.
Manage your emotions
The first step in managing market volatility is to manage your emotions. It’s normal to react emotionally to market events, but remember, you don’t have to act on those emotions when it comes to your finances and investments. If you’re feeling anxious, it’s always a good idea to speak to your financial planner for guidance and reassurance. A financial planner can help advise on past market experience, and if trends are likely to continue. They’ll also be able to tailor their advice to your specific circumstances.
Take the long view
It’s crucial to resist the urge to make impulsive decisions during market downturns. Selling when the market is down can heighten losses, potentially hindering your long-term financial goals. Unless you have an immediate need for the funds, sit tight and wait for the markets to recover. In fact, market dips can present great opportunities to invest in stocks, as this can provide you with a stable ground to return to once the market starts to pick up again. Remember, it’s not about timing the market, but time in the market.
Tuning out the noise
Next, focus on tuning out the noise. We are bombarded with news and information about the markets. But remember, the only days that truly matter in investing are the days you buy and sell. Be selective about the people, information, and news you engage with. Mass media often caters to the attention of the masses, so seek out reliable sources and filter out the noise. Your financial adviser will know what news and sources are relevant to your line of investing.
Look at the past
Looking at the history books can provide valuable perspective during times of turbulence. History has shown us that markets have always bounced back after dips, wars, crises, recessions, and depressions. It makes good sense to assume that they will do so again. Remind yourself that market volatility is a normal part of investing, and a long-term approach is often rewarded.
How to deal with market volatility
In summary, the best way to deal with market volatility is to manage your emotions, take the long view, tune out the noise, and look at the past. By following these strategies, you will be in a better position to navigate market volatility. Remember, investing is a journey, and staying focused on your long-term goals is key.
If you want to speak to one of our financial planners please don’t hesitate to contact us.
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Important Note
The information contained within this document is subject to the UK regulatory regime and is therefore primarily targeted at consumers based in the UK.
This article is distributed for educational purposes only and should not be considered financial advice.
If you are unsure about the suitability or otherwise of any product or service, we recommend that you seek professional advice.
The opinions stated in this document are those of the author and do not necessarily represent the view of Progeny and should not be relied upon to make a financial decision.
Information contained herein has been obtained from sources believed to be reliable but is not guaranteed.
If you are unsure about the suitability or otherwise of any product or service, we recommend that you seek professional advice.
Past performance is no guarantee of future performance.
The value of an investment and the income from it can fall as well as rise and investors may get back less than they invested. Your capital is therefore always at risk. It should be noted that stock market investing is intended for the longer term.
