Over the past few weeks, we’ve received many calls from clients, all asking the same thing: “What’s going on with the markets?”
The two major headwinds currently affecting the markets are:
- Increased interest rates, to offset inflation, which has had a negative effect on Fixed Income funds
- The Russia/Ukraine war, which is affecting the Equity markets
Unfortunately, no one knows how long these issues will affect the markets.
So, what do we do?
- Stay the course and ride it out. Prior to opening your investment plan, we did an investment questionnaire with you, to determine your investment objective and attitude towards risk, which ultimately built the investment plan that you’re on now. This plan was designed to weather down markets, which is why it’s important to stay committed to your long-term plan and resist making emotional decisions.
- If you’re taking an income from your investments, consider your income needs and whether you can reduce your payment amounts. Delay any large purchases. This will keep more of your money invested, which will help the returns on your investments over time and make your money last longer.
- Keep investing! Down markets offer us an opportunity to buy investments at a lower price per unit. When you’re shopping at Costco, do you wait until something is at full price to buy it, or would you rather buy it on sale? Investments are on sale right now, so if you can buy more, you should.
- Don’t try to time the market. Trying to guess what’s ahead isn’t a sound investment strategy. It’s about time in the market, not timing the market.
Markets eventually recover despite volatility. Staying the course is of the utmost importance during periods of volatility, as, historically, it has enabled investors to recover from these periods and achieve their long-term investment goals.
That being said, we’re always here to talk it out with you if you have concerns and would like to discuss your investment goals and the impacts of today’s markets. Our top priority is helping you and we’re here to do that in any way we can.