Keep Your Investment Plan SafeSubmitted by BCR Wealth Strategies on May 18th, 2020
Strange times, uncertain times, however you like to say it, it is. The U.S market took a tumble in March and with Stay-at-Home orders placed across not just the nation, but the globe, many were expecting that downward trend to continue.
Even with record unemployment, empty businesses, and negative earnings reports the S&P 500 jumped 12.7% in April. In fact, this was the best monthly performance since January 1987 for the S&P 500. The Nasdaq, weighted heavily with technology companies, gained 15.4% which is its best performance since the tech bubble of 2000.
So, what do you do with this information as an individual investor? My biggest takeaway from this is that while most people expected markets to continue to tumble, they cranked out some impressive returns. If you were to have invested emotionally and went to cash during this period then waited for things to “calm down” before getting back into the market, you would have missed out on one of the best one-month returns in market history.
Times like this in the market can be a real gut-check for some. It is important for long-term investors to make smart decisions and stick to their investment plan. Making changes or moving to cash during a downturn can have a significant impact on your future return (How a Small Tweak in Your Portfolio Could Affect You). While you can’t apply hand sanitizer to your portfolio, you can still “stay safe” by diversifying, rebalancing, and investing with a long-term mindset.
-Some of the material above was provided by Bob Veres Insider Information-