With so much volatility across the market, many investors are unsure how to proceed in this challenging period. So, here are 5 practical strategies to help you navigate this uncertain time.
It’s important to remember that market downturns are out of our control and therefore we need to focus on the things we can control in order to navigate them. Whether you’re new to the world of investing or have an extensive portfolio of assets, there are key things you can do to help set yourself up for success now and into the future. Here are the top 5 things to do in a bear market
TUNE OUT THE NOISE
Right now, checking your portfolio balance might send your down a rabbit hole of despair. So, one of the best ways to prevent making emotional decisions is to avoid frequently checking your assets in the weeks and months ahead. Plus, make sure to limit your exposure to financial news and the headlines, as this can cause you to deviate from your long-term investment strategy.
REVIEW YOUR ASSET ALLOCATION
This comes back to your tolerance for risk. Whether you’re close to retirement or are finding yourself concerned about market downturns, speaking with your financial adviser can help you make educated decisions about your asset allocation. By adjusting your split between stocks and bonds, you’ll be able to find a balance that best suits your personal circumstances and appetite for risk.
UNDERSTAND WHAT YOU CAN CONTROL
One of the best ways to manage feelings of anxiety during an uncertain like this is to focus your attention on what can control. Right now, managing the costs associated with your investments is a tangible step an investor can take to safeguard their wealth. Speak with your adviser to understand how to remove high-cost investments from your portfolio in ways that minimise the taxes due from their sale.
BE REALISTIC ABOUT YOUR EXPECTATIONS
With significant downturns across markets locally and abroad, investors should expect lower returns in the weeks and months to come. However, you can work with your financial adviser to create a strategic plan that helps to keep you on track to hit your long-term goals.
FOCUS ON DIVERSIFICATION
The investment strategy we use for all of our members at Fox & Hare emphasises the need for a diverse portfolio of assets. Why? Because this helps to insulate your portfolio and blunt the impact of downturns that may happen across the market over time. If you’d like to learn more about your particular financial situation, get in touch with us here.