This month saw the worst single-day performance for the Dow Jones Industrial Average in 2019, an 800-point (or 2%) drop. Last month, of course, saw a succession of new all-time highs in the equitiesThe amount of money that would be returned to shareholders if a company’s assets were sold off and all its debt repaid. markets. With the markets seemingly ready to swoon or spike with every presidential tweet, how can an investor be prepared to deal with ongoing volatilityA measure of how large the changes in an asset’s price are. The more volatile an asset, the more likely that its price will experience sharp rises and steep drops over time. The more volatile an asset is, the riskier it is to invest in.?
There’s a reason we here at Adviser Investments always talk about time in the markets, and not market timing: Day to day and week to week, markets can suffer startling declines. It’s only over time that we see the solid long-term returns that make investing worthwhile.
When facing up-and-down markets, it’s important to stay focused not on benchmarks and beats, but rather your own long-term objectives for your money—whether that’s sending a kid to college, paying for your retirement or buying a home. The last quarter of 2018 was the worst the stockA financial instrument giving the holder a proportion of the ownership and earnings of a company. market had seen in seven years. The first quarter of 2019 was the best it had seen in a decade. But if you’re a long-term investor, neither should matter in comparison with whether you’re meeting your own goals.
Of course, the kind of dispassionate analysis you need to understand whether you’re meeting those goals can be hard to perform in the midst of rocky markets. That’s where we can help: Our portfolio managers, analysts and financial planners have decades of experience dealing with and preparing for all kinds of market conditions.
For more context on our thoughts on how to deal with volatility, check out our podcast on dealing with market corrections. And if you have specific questions about how your portfolio is positioned, please don’t hesitate to speak to one of our portfolio executives. We’ll be happy to conduct a free portfolio review and walk you through where you’re at and what you can do to make sure you stay on track.
This material is distributed for informational purposes only. The investment ideas and expressions of opinion may contain certain forward-looking statements and should not be viewed as recommendations, personal investment advice or considered an offer to buy or sell specific securities. The views expressed in this update are subject to change at any time. Mutual funds and exchange-traded funds mentioned herein are not necessarily held in client portfolios. Data and statistics contained in this report are obtained from what we believe to be reliable sources; however, their accuracy, completeness or reliability cannot be guaranteed.
Our statements and opinions are subject to change without notice and should be considered only as part of a diversified portfolio. You may request a free copy of the firm’s Form ADV Part 2A, which describes, among other items, risk factors, strategies, affiliations, services offered and fees charged.