Over Time, Markets have Proved Positive and Resilient

When markets react, consider a broader historical perspective before changing your financial course.

Market volatility can often trigger emotional responses in investors, responses that can impact judgment and potentially affect long-term plans.

These periods of volatility are an opportunity to connect with your advisor, enabling them to act as a sounding board for your concerns. By talking about current events in light of your overall financial plan, your advisor can provide reassuring perspective to help you stay the course or readjust if needed.

Pullbacks throughout history

Pullbacks can make you want to pull up stakes and run – a reaction that’s often a mistake, especially for long-term investors. The right knowledge and historical perspective can help us avoid making investment decisions based on emotion rather than strategy.

By looking at the market over a long period of time, we’re provided with a true testament of resiliency. Each decline along the way felt terrible, and declines today feel just as uncomfortable. But when we track the overall growth the market has achieved, it’s clear that there are benefits to persistence, patience and commitment.

Remember:

  • The stock market is cyclical.
  • You will likely encounter numerous pullbacks and/or corrections as a long-term investor.
  • A study of the stock market shows its resilience.
  • In the long run, the upturns have always been stronger than the downturns.

Stocks overcome bumps in the road
Growth of $10,000 in the S&P 500