We are all witnessing the increased recent market volatility in the financial markets and it is natural to wonder how this may impact our wealth. Often times the various media outlets will sensationalize news at the expense of our emotions. We urge you not to focus on the headlines at the expense of your personal goals. We will remain vigilant and continue to monitor market developments. In that regard, we wanted to highlight a couple important aspects:
Markets are volatile:
The reason we expect higher long-term returns on stocks than on cash and bonds over the long haul is because they have greater volatility. We have to accept volatility in times like these in order to earn the potential higher long-term returns that stocks have to offer. The advisors at Stoddard Financial takes a disciplined, long-term view on asset allocation and our clients’ portfolios are invested in models based on their unique financial and personal risk tolerances.
In some short term environments (such as now) it does appear that many asset classes are declining in unison. As this happens, we do reevaluate asset classes for potential sale or inclusion in client portfolios. We are continuing to monitor client accounts to see if any “tweaking” is warranted.
Please keep in mind that we are not trying to “time” the market as that can be a very difficult task. At the same time we believe in being prudent with where and how we take and manage risk.
As always, please contact us if you have any questions or concerns. In particular, if you anticipate taking additional distributions from your account over the next year that we are unaware of, please call to let us know the timing and amount of your distribution.
Kevin Stoddard, CFA®
The opinions voiced in this article are for general information only. They are not intended to provide specific advice or recommendations for any individual and do not constitute an endorsement by LPL Financial. To determine which investments may be appropriate for you, consult with your financial professional. Please remember that investment decisions should be based on an individual’s goals, time horizon, and tolerance for risk. There are no guarantees that any managed portfolio will meet its intended objective. Neither asset allocation nor diversification can ensure a profit or prevention of loss in times of declining values. Investment in stocks will fluctuate with changes in market conditions. Indices are unmanaged measures of market conditions. It is not possible to invest directly into an index. Past performance is no guarantee of future results.