When it comes to investing, our emotions are not our friend. Instead of panicking, call us!
Already reeling from the prospect of higher interest rates, ongoing supply chain issues from the pandemic, inflation, and increased geopolitical uncertainty, our emotions are running hot, and our sense of security has been rattled—not to mention the fact that financial markets have been volatile.
It’s understandable for investors to panic when markets suffer a sharp decline. After all, that’s our hard-earned savings and investments we see disappearing. It’s the financial security we’re counting on to make important purchases, live our lives comfortably and care for our loved ones.
Unfortunately, though, that sense of panic that comes so naturally is not our friend. In fact, it can cause us to behave in a way that is in direct conflict with our best interests. You know the old saying “buy low, sell high.” Well, panic can easily make us do just the opposite.
So, what’s an investor to do instead? Utilise the years of experience at iInvest, who have lived to tell the tale of many market upheavals….call us!
A very good tip from the iInvest team, is to focus on constructing a balanced portfolio over time, which will make investing less an epic battle between you and the markets, and more a tug-of-war between your emotions and your actions. Warren Buffet puts it this way: “All that’s required is the passage of time, an inner calm, ample diversification, patience, and a minimization of transactions and fees.”
Yes, that’s a tall order. But overall when the markets decline, do your best to focus on your goals and stay the course. Try to view periodic losses and uncertainty as nothing more than distractions. Investing rewards those who have a disciplined process and requires patience during times of volatility and uncertainty.
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