Market Volatility
When markets fluctuate, it’s easy to feel unsettled, but you don’t have to navigate those feelings alone. Working with a financial advisor can help make a difference. My team and I pride ourselves on our commitment to helping you stay the course. Rather than reacting impulsively, we work with you to plan deliberately. With strategies supported by research and knowledge, we’ll face uncertainty together, with purpose and conviction.
Recognize the normalcy of market swings
Market ups and downs may feel alarming in the moment, but history tells us they’re an inevitable part of investing. Attempting to time the very bottom or top of the market can be costly. In fact, studies show that missing just a few of the best market days can dramatically reduce long-term results.1
So, rather than trying to “guess correctly,” we’ll aim to build a plan based on your goals, risk tolerance, and time horizon.
Begin with a plan built for your life
A sound investment strategy begins with clarity on your goals, whether it’s retirement, a college savings fund, legacy giving, or something else entirely. Together, my team and I can help you determine how much liquidity makes sense and how much long-term growth you may need. With that in place, the rest of the plan follows.
Construct a diversified, goal-aligned portfolio
Once your goals and timeframes are clear, we can help you design a portfolio. Asset allocation — i.e. the mix between stocks, bonds, real assets, and alternative investments — has proven to be an effective investment strategy, as opposed to trying to pick the next “hot” stock. We’ll also consider global diversification, liquidity needs, and your comfort level with market swings.
Stay disciplined through volatility
Our goal is to help you avoid acting on the emotions typically involved with investing: greed and fear. It’s tempting to think rising markets will continue to do so, and greed can cause you to chase gains. Similarly, fear can kick in when the markets plunge, and the impulse may be to sell everything and get out entirely before the markets hit bottom. However, both impulses undermine long-term success. For example, the best days and the worst days often cluster together, and thus being out of the market even briefly can mean missing key rebounds.
While working with you during periods of market volatility, we will encourage you to consider the following:
· Rebalance when necessary, trimming asset classes that have grown too large and adding to those that have fallen short of their target
· Stay aligned with your strategic allocation, adjusting only when your goals, time horizon, or risk profile change
· View turbulence as opportunity, not panic; volatility can allow disciplined investors to “buy low” and set the stage for recovery
Before you react, talk through what’s happening
When market headlines flash and emotions run high, my team and I will be here to guide you. We’ll review how your portfolio is positioned relative to your plan, consider the long-term context, and decide if any tactical shifts make sense. But we’ll do so within the framework of your overall strategy, not on a whim.
Take the next step
If you’re looking for help building a plan or refining a plan, I’d love to connect. Please reach out to schedule a complimentary consultation. Together, we’ll map your goals, clarify your priorities, and craft a strategy that can help keep you on track, even when the market isn’t.
1. "The perils of trying to time volatile markets: Missing the market's best days," Bloomberg and Wells Fargo Investment Institute. Read more.
All investing involves risk including the possible loss of principal.
Asset allocation and diversification are investment methods used to help manage risk. They do not guarantee investment returns or eliminate risk of loss including in a declining market.
Advisory Services
- Your investments are important. Advisory Services can help them receive the care they deserve.
- Your investments can be professionally managed or a Financial Advisor can help you manage them yourself.
- Wells Fargo Advisors programs allow flexibility to help you reach your goals.
Managing investments
A lot may be riding on your investments: retirement, children’s or grandchildren’s education, your financial legacy. Your investment plan should get the attention it deserves.Some investors enjoy managing their own plan. They are confident in their abilities and have the time to research and monitor their investments’ performance.
You’re not alone if you don’t fall into that category. Like many others, you may want to work with a professional by taking advantage of an advisory program.
Using an advisory program
You can save time and have a professional manage your investments when you use the services of an advisory program.Advisory programs generally fall into two categories. One gives another party the power to make decisions for your account’s day-to-day management. This means you can allow a portfolio manager — in some cases your Financial Advisor — to decide when to buy, sell, and hold investments without consulting you.
Your portfolio manager will make decisions based on a variety of factors:
- Your long-term objectives
- The time you have to reach your objectives
- Your risk tolerance
In the other program, you collaborate with your Financial Advisor. We will provide you with objective advice and guidance based on your needs, goals, and today’s investment environment, to help you make your own buy, sell, and hold decisions.
Fee replaces commissions
So how can an advisory account differ from a traditional brokerage account? One difference is how you pay for the services you receive. In an advisory account program, you generally pay a fee. This is often charged on a quarterly basis based on a percentage of your account’s value. In a traditional brokerage account you would pay a commission for each transaction.
Flexible range of alternatives
You can choose which advisory services program you implement. Wells Fargo Advisors offers an array of programs. You can decide what products you would like to have managed, such as mutual funds, exchange-traded funds (ETFs), stocks, bonds, and commodity-based investments.
We can discuss the programs with you and see what fits your situation – and what makes you feel more confident in helping you reach your goals.
Next steps
Decide if you would like some extra help with making your investment decisions.
Make an appointment to talk with us about advisory accounts.
The fees for advisory programs are asset-based and assessed quarterly in advance. There may be a minimum fee to maintain this type of account. Fees include advisory services, performance measurement, transaction costs, custody services, and trading. These fees do not cover the fees and expenses of any underlying exchange traded fund (ETF), closed-end funds, or mutual funds in the portfolio. Advisory accounts are not designed for excessively traded or inactive accounts and are not appropriate for all investors. Please carefully review the Wells Fargo Advisors advisory disclosure document for a full description of our services, including fees and expenses. The minimum account size for these programs is between $10,000 and $2,000,000.