We’ve all heard the old adage to “buy low, sell high,” but the reality is, some investors do just the opposite—they buy high and sell low. Taking a look back at market history, while factoring in behavioral science, shows us not only why investors react this way, but more importantly, how they can avoid it. If we have a better understanding of market volatility, the risks of certain investment strategies, and the value of a thoughtful investment plan (that you can stick to), we can invest with confidence and stay on track in pursuit of our goals.
Centra Financial Services works with you to construct a plan designed to weather short-term market declines and help you work toward your goals over the long term. We aim to work toward your goals, which are certain, rather than market performance, which is uncertain. Chasing market performance could also introduce unnecessary risk, whereas pursuing your goals ensures we’re managing risk where we can and seeking to build value over the long term.
When working with us to build and evaluate your plan, we encourage you to view it in light of its long-term objectives. We anticipate and plan for market dips and spikes and keep our eye on the horizon when constructing your strategy. By keeping your view focused on the long term, you can reduce the emotional impact of short-term changes in account value. If the past has told us anything, it’s that the value will likely be different tomorrow!
We’re here to coach you through challenging market environments and help you maintain your long-term view. We’ll also look for opportunities to make adjustments as needed, and we can always revisit your goals and risk tolerance as your life or perspective changes. Together, we can make a plan for any market environment. By sticking to it, you help increase the chances of reaching your goals.
Now that you know how your brain may react, you can prepare for it ahead of time. You know the markets historically tend to go up over time, and you know the risks of following the herd and pulling out of the market when times look scary. You have all the tools you need to remain committed to your long-term plan, which means you can stay on track toward your goals.
We’re also committed to helping you through both exciting and challenging times. If you need an accountability partner, and someone to help you “train your brain,” we’re for you. We’ll get through whatever the market has to throw at us and come out the other side stronger for it.
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This material is for general information only and is not intended to provide specific advice or recommendations for any individual. There is no assurance that the views or strategies discussed are suitable for all investors or will yield positive outcomes. Investing involves risks including possible loss of principal. Any economic forecasts set forth may not develop as predicted and are subject to change.
There is no assurance that advisory accounts are suitable for all investors or will yield positive outcomes. Advisory relationships involve a higher standard of care than brokerage and typically require an ongoing duty to provide advice and monitoring. Advisory accounts should only be recommended if it is suitable for the investor.