This is part one of Capital Growths’ mini blog series exploring the current state of the American financial market, what it means for your financial health and how you can keep your finances afloat during the COVID-19 pandemic.
Given the pandemic, oil collapse and forced closing of the economy along with the speed of these events blinding everyone, stock market volatility is expected and may persist.
However, the percentage decline is not as excessive when compared to the last two declines from the Dot-Com crash and the Financial Crisis. Today’s economy is better positioned to recover.
Stock market volatility also allows investors to take advantage of opportunities, such as rebalancing and reallocating cash to lower priced equities, and realizing the benefit over the long-term.
Nobody likes market volatility and much of it is borne from short-term panic and fear.
If you look at any long-term chart you will see long periods of growth interrupted by occasional violent swings up and down.
History and data supports the premise that markets are resilient. Through world wars, oil embargoes, great market crashes, terror attacks, bank failures, and now a global pandemic, the market as a basket of America’s best companies has proven to ultimately adapt and adjust to conditions on the ground and recover in time.
Periods of volatility are often the most important to not panic and take advantage of temporarily depressed equity prices.
Schedule a free consultation with our team to discuss how you can best leverage your assets amidst these uncertain times.
Risk Disclosure: Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values. Past performance does not guarantee future results.
This material is for information purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. The content is developed from sources believed to be providing accurate information; no warranty, expressed or implied, is made regarding accuracy, adequacy, completeness, legality, reliability or usefulness of any information. Consult your financial professional before making any investment decision. For illustrative use only.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance. The Standard & Poor’s 500 (S&P 500®) is an unmanaged group of securities considered to be representative of the stock market in general. Indexes are not available for direct investment. The performance of the index excludes any taxes, fees and expenses.
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