Tags: investors | anxious | nervous | stock market

US News: 4 Tips for the Anxious Investor

US News: 4 Tips for the Anxious Investor
(Dollar Photo Club)

By    |   Tuesday, 19 January 2016 06:39 AM


With markets surging 300 points one day and plunging 500 points, the next, most investors are trying to determine the best way to stop being mauled by the bears or gored by the bulls.

"Behavioral finance tells us that during periods such as these, investors will become fearful – as fear is a very powerful emotion driving investor behavior," Kevin Jacques, a former U.S. Treasury economist and Boynton D. Murch Chair in Finance at Baldwin Wallace University in Berea, Ohio, told US News.

"Investors get into trouble when they act not as part of their plan, but rather react to the emotion of the moment regarding what's happening in the market."

Let’s highlight 4 of the way best strategies investment experts suggest:

Risk is a fact of investing life. How is it that some thrill junkies who bungee jump and skydive can't take the same attitude toward a market plunge? Maybe it's the money at stake. "Investors are risk-averse – always have been, and always will be," says Joe Halpern, CEO of Exceed Investments. "Understanding that risk is a vital component of investing, and the only way to generate reward, is a great first step. We have the technology and products today to better fit the varying needs of investors."

Bad is often good. "Our research finds that it has paid to stay invested in U.S. stocks during times of economic uncertainty," says John Sweeney, executive vice president of retirement and investing strategies at Fidelity Investments. "The best five-year return in the U.S. stock market began in May 1932, in the midst of the Great Depression. The recession of July 1982 and March 2009 also yielded significant five-year returns."

Stop consulting Google. "Today's investors of all ages have become more interconnected from tools like Google search to a plethora of news and financial sites with gobbledygook financial predictions and forecasts," says Jon Ulin, managing principal of Ulin & Co. Wealth Management, based in Boca Raton, Florida. "This investor problem is no different than sick people looking up an ailment online, not seeking professional help and making their own incorrect assumptions and diagnosis."

Don't look back. You can't drive looking in the rear-view mirror all the time, yet that's exactly what too many rattled investors do. "The post-financial crisis world increased the amount of suspicion and cynicism in the minds of retail investors, and recent events have only made these fears more acute," says John Ocwieja, a personal and business financial specialist with Hoopis Group, Chicago, a MassMutual agency. "But the fears are always the same: No one wants to lose money, no one wants to waste time, no one wants to feel exploited, no one wants to wake up in the future regretting a choice made in the past – and no one wants to look stupid."

It easier said than done, but many experts urge investors to keep calm and continue to trade on.

Kristina Hooper, head of U.S. capital markets research and strategy for Allianz Global Investors, says investors shouldn't panic, but they can take steps to navigate the market's perils. “They should be cautious, but they shouldn't be worried,” she told the AP.

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With markets surging 300 points one day and plunging 500 points, the next, most investors are trying to determine the best way to stop being mauled by the bears or gored by the bulls.
investors, anxious, nervous, stock market
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2016-39-19
Tuesday, 19 January 2016 06:39 AM
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