How to Stay Sane in a Crazy Market

Keeping your cool can be hard when the market feels like a roller coaster. Having a strategy to prepare yourself, psychologically speaking, for big market moves can pay off in the long run (literally).

Here are the Bogart Wealth team’s tips for keeping your cool in a crazy market.

1. Have a plan

When you have an overall strategy for why you’re investing and how, it’s easier to weather turbulent times. It can also help you avoid making decisions based on emotions. Ideally, your financial advisor will have planned ahead and accounted for potential turbulence and risk.

2. Know what you own & why you own it

When the market goes off the tracks, knowing why you originally made a specific investment can help you evaluate whether your reasons still hold, regardless of what the overall market is doing.

When you understand why you own an asset, you might start to see downturns as a potential buying opportunity—as if the asset went on sale.

If you don’t understand why you hold a particular investment in your portfolio, don’t be afraid to ask.

3. Everything is relative

Big fluctuations in the stock market don’t necessarily mean you’ll see big fluctuations in your portfolio. With a well-diversified portfolio that includes multiple asset classes, you may not see as much volatility as the overall stock market suggests.

Even a diversified portfolio is no guarantee that you won’t suffer losses, of course. But diversification means that just because the S&P 500 might have dropped 10% or 20% doesn’t necessarily mean your overall portfolio is down by the same amount.

Try to evaluate performance against relevant benchmarks and not the market headlines you see on the news. Even better, speak with your advisor to see if your portfolio still has you on track to meet your goals.

4. This too shall pass

It’s normal for the financial markets to experience ups and downs. Timing the market to enjoy the ups and avoid the downs is nearly impossible, and, generally speaking, data shows that “time in the market works better than timing the market.”

One thing to remember? Historically, the stock market goes up over time. While past performance is not indicative of future results, a recent Credit Suisse study showed U.S. stocks returned 9.5% per year on average from 1900–2023.

5. Learn from your mistakes

It’s easy to be a good investor in bull markets. Bear markets, however, highlight the importance of sound fundamentals and planning. Consider using volatile periods or market downturns to evaluate what you’re doing that’s working and what you might want to improve.

6. Embrace potential opportunities

Even investment losses can present opportunities—from tax-loss harvesting to tax-loss carry forwards. A downturn in your investments, when handled properly, could help you minimize your tax liability.

7. Look in the rearview mirror

When the future feels uncertain, it can help to look back to see how far you’ve come on your investing journey. It can be easy to forget any progress you may have already made over the years.

Though past performance is no guarantee of future returns, it’s important to remember that having an investing strategy is only half the battle; the other half is being able to stick to it.

8. Call your advisor

If you’re worried about the economy, the market, or more specifically, your personal portfolio, you can always make adjustments. Speak with a financial advisor who can help you understand how decisions made during uncertain times may help or hurt you in the long run when markets inevitably recover.

Remember: Volatility is par for the course in investing. And while all investing carries risk, sitting on the sidelines carries risk as well. The tips in this article are designed to help you weather inevitable market ups and downs.

However, if you’re still feeling anxious about market activity or your family’s investments, reach out to a Bogart Wealth Advisor.

Please remember that past performance is no guarantee of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Bogart Wealth, LLC [“Bogart Wealth”]), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level (s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from Bogart Wealth. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. Bogart Wealth is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice. A copy of the Bogart Wealth’s current written disclosure Brochure discussing our advisory services and fees is available for review upon request or at bogartwealth.com

Please Note: Bogart Wealth does not make any representations or warranties as to the accuracy, timeliness, suitability, completeness, or relevance of any information prepared by any unaffiliated third party, whether linked to Bogart Wealth’s web site or blog or incorporated herein, and takes no responsibility for any such content. All such information is provided solely for convenience purposes only and all users thereof should be guided accordingly.
Please Remember: If you are a Bogart Wealth client, please contact Bogart Wealth, in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing/evaluating/revising our previous recommendations and/or services, or if you would like to impose, add, or to modify any reasonable restrictions to our investment advisory services.  Unless, and until, you notify us, in writing, to the contrary, we shall continue to provide services as we do currently.
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