Feeling emotional about your investments?
Recent market volatility may have left you feeling ready to cash out of all your investments. But as this clock shows, stock market cycles — ups and downs — often cause investors to do the wrong thing at the wrong time.
During periods when equity returns have been relatively high, people have tended to flock to the market — when prices were at their highest.
But when equity returns have lagged, many have sold their holdings and left the market — at a time when stock values have been most attractive.
In essence, these investors bought investments at a high price and sold them when their value was low — the opposite of the “buy low, sell high” philosophy.
What you can do:
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Remember that it’s natural to feel worried
Even people who are aware of the market’s historical cycles may feel torn between their emotions and knowledge.
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Follow your head rather than your stomach
Maintaining a regular investing strategy means you have the opportunity to take advantage of market declines like this one by purchasing more shares for less money.
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Talk to your financial professional
Before making any decisions make sure your emotions are in check and talk to your financial professional. Take steps to ensure that your long-term investment strategy stays on track.
Investing in a volatile market
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Strategies for dealing with market volatility
Don’t forget the fundamental principles of investing, especially during difficult times.
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Thoughts from three of our investment professionals
Three veteran American Funds portfolio counselors talk about current strategies and how they view the future.
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Three lessons from market declines
Past market declines can provide meaningful lessons and perspective.
Return to topInvestors should carefully consider the investment objectives, risks, charges and expenses of the American Funds. This and other important information is contained in each fund’s prospectus and/or summary prospectus, which can be obtained from your plan’s financial professional or downloaded and should be read carefully before investing.