Konstantin Lichtenwald of Vancouver recently discussed how to keep your cool when the stock market plunges.
VANCOUVER, BRITISH COLUMBIA / The coronavirus pandemic has put the stock market in turmoil. Investors have seen the market rapidly alter from record highs to a drastic crash. However, Konstantin Lichtenwald of Vancouver explained that while the coronavirus pandemic primarily caused this crash, a market doesn’t need a pandemic to drop drastically without warning.
Konstantin Lichtenwald of Vancouver explained that a down market is not uncommon and crashes have happened countless times over the years. He stated that it’s inevitable for investors to experience a crash at some point, so it’s best to be mentally and financially prepared. Konstantin Lichtenwald of Vancouver recently explained how to stay calm when this occurs.
“It’s best to prepare yourself for a crash, knowing that one will likely occur in the future,” Konstantin Lichtenwald. “I recommend following five simple steps to ease your nerves when this occurs.”
First, Konstantin Lichtenwald of Vancouver explained that investors should be prepared with a diverse investment portfolio. Investing a portion, such as 30 percent, of your money in a diversified bond fund will provide the security you need to ride out the storm.
Second, Konstantin Lichtenwald of Vancouver suggested understanding that you took the risk to invest in the stock market, and ups and downs are only natural. Remember that downturns in the market are eventually followed by terms of growth. Konstantin Lichtenwald added that you may be feeling emotional, but he recommends resisting the urge to sell. You don’t want to sell a good long-term investment solely because you’re feeling stressed.
“While I don’t recommend selling investments made for long-term growth, I do recommend being willing to grab investments while stocks are dropping,” Konstantin Lichtenwald of Vancouver said. “This can be a prime time to scoop up stocks you’ve wanted to own but had prices that were too high.”
Finally, Konstantin Lichtenwald explained that you shouldn’t be afraid to get a second opinion. A qualified financial advisor can help you assess your current portfolio and rest your nerves. In fact, Konstantin Lichtenwald of Vancouver stated that many financial advisors hire financial planners to help them do the same. A second set of eyes can catch any issues and help you make wise investments during the downturn.
“Mostly, I encourage my clients to remain calm when crashes like this one we’re currently experiencing occur,” Konstantin Lichtenwald said. “The coronavirus pandemic will pass, and we just need to remain patient.”