In times of extreme market volatility, what's an investor to do? Sure, it makes sense to turn to a trusted financial advisor for advice to get a handle on what's going on with the market situation. But everyone has an opinion, and there is . With insider information and dissected reports, some may be thinking it's the beginning of the end while others see it as a bump in the rocky road.
You probably shouldn't rely on the financial media who do a great disservice to us investors by encouraging panic and fear. So-called experts on primetime TV who foresee doom and gloom or rapid recovery don't own or use crystal balls. They really have no better idea of future market conditions than you do. The truth is, nobody really knows. And if they claim to, they're probably just pretending. Past events cannot dictate the future of the market. A solid financial planner will tell you that don't follow a pattern. There are no codes to break – no trends to analyze. Just watch the stock market activity for a couple days. You'll see that what happened yesterday won't necessarily affect tomorrow's stock prices.
So, what's best? Pulling the cord and jumping? Sticking it out and hoping for the best? Some believe that investors who scrutinize the financial news and make investment decisions based on predictions often end up losing money. They believe that those who stay the course and ignore market volatility reap the returns of the capital markets. Others are tired of being told they should just buy and hold, so they panic and sell.
The traditional advice financial advisors give in a market such as this would be to hold tight and don't give into panic. It is easy to be pulled away from a strong long-term strategy when markets are under pressure. The numbers would suggest that it is important to stick with your strategy and remain mindful of getting caught up in the emotional drive of the . Opportune selling times rarely surface during periods of elevated emotions.
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