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Who are you ?

RETIREMENT PLAN INVESTOR

Use your plan ID (available on your account statement) to determine which employer-sponsored retirement plan website to use:

IF YOUR PLAN ID BEGINS WITH IRK, BRK, 1 OR 2

Visit americanfunds.com/retire

IF YOUR PLAN ID BEGINS WITH 34 OR 135

Visit myretirement.americanfunds.com

Feeling emotional about your investments?

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:

  • 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.

  • 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.

  • 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.

Infographic with a clock-like image in the middle.  Historically, during periods when equity returns have been relatively high, people have flocked to the market. But when equity returns have been low, many have left the market—at a time when stock values have been most attractive.  The clock image represents emotion being pulled in different directions based on where prices are at a given time. Between 11 o’clock and 1 o’clock, investors usually buy here, at the top, when prices are high. Working in clockwise motion, prices decline and the market is seen as declining at 3 o’clock. Continuing forward, investors will often sell when prices are low, which is at the 6 o’clock point. As prices rise again, the market is seen rising as it approaches the 9 o’clock position, and continues to start again at the top at 12 o’clock. Using the clock analogy, it appears to be a continuous cycle.

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Market perspective

Don’t forget the fundamental principles of investing, especially during difficult times.

Put market declines in perspective with this historical comparison.

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