How to manage your investments in a volatile market
The Dow Jones dropped 7.8 percent Monday, marking the worst fall since 2008.
So what should you do with your investments? Scott Brown, a CFA with Edward Jones, recommends avoiding any emotional decisions.
"Often we have a knee jerk reaction and we need to see how things play out," Brown said.
For those with money in the market, it's likely you took a hit Monday. In fact, the market had been up and down for the past two weeks due to fear of coronavirus, and now with crude oil prices plunging to a 30 year low, there's more concern and what Brown calls "nervous trading."
So what should the average person do when the markets are volatile? Brown recommended knowing what you are investing in, knowing your risk and then evaluating how much you are willing to put in that might not pay out.
If you can afford to do so, this also might be a time to buy.
"Some of the best stock market gains occur in times like this. So you got to be careful, you don't want to make any radical changes because you could be doing more damage than help by making a decision based on emotion," Brown said.
As for 401Ks, Brown said stay the course if you are in the long-game. It's typically your best option, but just know the market does fluctuate and we have seen this before.
For those who are closer to retirement, you might need to tweak your portfolio to protect what you have, but in the end, Brown is confident this to shall pass.