Don't Lose ItYou

U.S. Wealth Management of Boston |

By Jonathan Clements from HumbleDollar

HERE’S THE LEAST surprising thing you’ll read this week: You can’t control the financial markets. They’re driven by news—and we simply don’t know what news we’ll get in the weeks and months ahead, whether it’s about the spread of the coronavirus, its impact on the global economy or something else entirely.

But don’t despair: There’s also much that we can control, including how much we save and spend, the amount of investment risk we take, how much we pay in investment costs, our portfolio’s tax efficiency and—most critically at a time like this—our own emotional reaction to market ups and downs.

Indeed, if you were going to design a laboratory experiment to test investors’ mettle, this past week would provide a nearly perfect template. Think about it: We have a virus without a vaccine that’s spreading rapidly—but nobody knows how rapidly—which is damaging the global economy—but nobody knows how badly—at a time when many U.S. stock investors were already anxious after an extraordinarily long bull market that has pushed valuations to worrisome levels.

Feeling unnerved? It would be shocking if you weren’t. Think about all the ways that this year’s market action has messed with our heads.

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The opinions voiced in this article are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.