How to Handle Stock Market Shifts

 
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Worried about market fluctuations that affect your investments? You’re not alone. But of course, investing is done over the long term, and over time, there are always ups and downs. If you tend to worry, here are some tips to help you stay focused on the future:

 

  1. Diversify
    Simply put, different investments perform differently. So invest across a variety of industries, and types of investments, including stocks, bonds, and cash alternatives that are less risky. That way you’ll balance your total risk and when the value of one drops, another may increase or remain relatively steady.

    Our advisers can help you decide on a good mix for you, based on your life circumstances and investment goals.
     
  2. Be patient
    Don’t pull out of an investment just because the value has dropped a bit. If you have many years before you’re planning to use your investments to live on, just wait. Chances are the value will return and increase further over time. Dropping out quickly only ensures that any losses will be permanent – and starting over with a less risky investment may not net as much returned value over time.If you’re not sure whether changing your strategy is a good idea or not, you’re welcome to reach out to us at any time to help assess what’s right for you.
     
  3. Consider buying more!
    If markets swing down, your money goes further. Investing during a downturn will allow you to buy more shares — and when the market inevitably rises again, you’ll have increased your investment earnings potential.
     
  4. Stick with it 
    You can average out your costs by making regular investments, if you can afford it. One way to do this is through a workplace savings plan, like a 401(k). Your employer can automatically deduct your investment (at a set amount) from each paycheck — and over time, you’ll have bought shares at both lower and higher prices, for a steadier average cost.
     
  5. Don’t ignore it
    You don’t want to focus too much on the short-term results. But ignoring your investments completely isn’t wise either. Talk to your adviser about once a year, or more often if you’ve had a dramatic life change. Your adviser can help you determine if a change to your portfolio makes sense, and when.

Need help?

Talk to us. Horizon Bank has team members ready to assist with Sensible Advice for your investment strategy.