{"id":2552,"date":"2016-03-01T13:55:35","date_gmt":"2016-03-01T18:55:35","guid":{"rendered":"https:\/\/blog.bradpine.com\/?p=2552"},"modified":"2016-03-02T13:32:55","modified_gmt":"2016-03-02T18:32:55","slug":"is-the-stock-market-making-you-dizzy-maybe-its-time-to-call-your-financial-advisor","status":"publish","type":"post","link":"https:\/\/blog.bradpine.com\/2016\/03\/01\/is-the-stock-market-making-you-dizzy-maybe-its-time-to-call-your-financial-advisor\/","title":{"rendered":"Is the Stock Market Making You Dizzy? Maybe it\u2019s Time to Call Your Financial Advisor"},"content":{"rendered":"

\"stretchedWhat a difference a few weeks makes: the DOW Jones Industrial Average and the S&P 500 both fell about 10% from the beginning of the year to mid-February. Then, the DOW rallied 1,013 points or 6.53% from the low on February 11. This all happened in the space of 11 days. As of the close on February 29, both indexes are still down in the range of 5%. It\u2019s certainly been a wild ride. (1)<\/h4>\n

As I said last month in my article The Stock Market: Time to Panic! or Time to Buy!???<\/a>, while these kinds of markets can keep you on the edge of your seat, over the long run we usually forget about them.<\/h4>\n

That doesn\u2019t mean they\u2019re easy to get through. For a lot of investors, it doesn\u2019t matter if this will end up as just another blip on the radar because they\u2019re losing sleep over it right now.<\/h4>\n

If you\u2019re in the same boat — or if you\u2019ve been avoiding all of the turmoil because you\u2019re worried about your account balance — now that the market has done an about-face from the bottom, it might be a good opportunity to step back and rethink your asset allocation.<\/h4>\n

Balancing performance with blood pressure<\/span><\/h2>\n

Changing an allocation that\u2019s not in line with your real risk profile might be a good idea. Don\u2019t get me wrong: I\u2019ll be the first one to tell you that, in the long run (when time is on your side), equities tend to drive portfolio returns. I\u2019ve been doing this for 24 years, and I believe that investing in the stock market is at the very top of the list of things you can do to grow your savings over time — but only if you\u2019re prepared for the risk.<\/h4>\n

The key to making it work is prudent diversification.<\/h4>\n

A well-diversified portfolio may not grow as dramatically as betting on an individual stock or two when times are good, but it should offer you much less volatility when markets go through swings like the ones we\u2019ve recently seen. I like to help my clients construct portfolios that incorporate many asset classes and include specialized managers. Overall, my goal is to help harness growth opportunities in the market without exposing my clients\u2019 portfolios to too much risk in any one area.<\/h4>\n

However, sometimes a specific asset allocation plan can make sense on paper but not in practice. If a potential client comes to me feeling anxious because of the market and they don\u2019t know what to do, I take it as a sign that they need to reevaluate their strategy.<\/h4>\n

Reevaluating poor performance<\/span><\/h2>\n

At the end of the day, you have to balance the financial with the emotional, and sometimes that means reducing risk simply because it helps you sleep at night. While there are investors who build higher-risk portfolios on purpose, most people should consider a slow and steady approach.<\/h4>\n

That\u2019s why I put so much emphasis on portfolio construction. An appropriately diversified portfolio should help cushion falls in the market — which will also take some of the stress out of volatility.<\/h4>\n

Of course, if you\u2019re not sure of what your performance is, it\u2019s time to take a look.<\/h4>\n

A lot of investors hide their heads in the sand when the market gets rough. This makes complete sense psychologically, but it could be a very bad idea financially. If you\u2019re avoiding your account statements or if you\u2019ve lost track of where all your accounts are, this could be the right time to get back into the game. Volatile markets bring a wealth of opportunity, so instead of ignoring the news now is a good time to use it.<\/h4>\n

How do you know if you need to do something?<\/span><\/h2>\n

You might know in your gut that it\u2019s time to take action on your accounts and your allocation strategy. But if you\u2019re not sure, consider these questions:<\/h4>\n

\u2022 Do you feel that your portfolio is well-diversified?
\n\u2022 Do you understand the logic behind your asset allocation — and do you know what that allocation is?
\n\u2022 Do you know how your long-term portfolio has performed relative to the market?
\n\u2022 Have you reviewed or rebalanced your accounts in the last 2 years?
\n\u2022 Have you avoided rolling over an old 401(k) because it seems like too much work?
\n\u2022 Have you stopped opening your account statements?<\/h4>\n

If you\u2019re unsure about your allocation or performance, or if you\u2019ve been avoiding dealing with your investments altogether, now could be a good time to think about your asset allocation. You could start by by consolidating your accounts — roll over old 401(k)s, put different brokerage accounts together, and so on. This helps many investors get a clearer picture of where their money is.<\/h4>\n

Next, it\u2019s time to address your asset allocation. Do you feel comfortable with the level of risk in your account?<\/h4>\n

If you\u2019re not sure about the answers or don\u2019t know how to address them, you might want to consider talking to an advisor. A good advisor will not only help you design an allocation strategy but will take the time to answer all of your questions. This is much more important than most people realize: if you know why your account is allocated in a certain way, the market ups and downs should be a lot less stressful. An understanding of the big picture can really help you cut through short term volatility.<\/h4>\n

Of course, sometimes allocations don\u2019t work for an individual no matter how logical they are. Like I said before, it\u2019s a matter of balancing the financial with the emotional, and markets like these are a good testing ground for thinking about that balance. If you\u2019re totally on top of your accounts and understand the strategy but you\u2019re still struggling, it\u2019s a good time to rethink your plans. There\u2019s no shame in building a portfolio that doesn\u2019t keep you up at night — especially if it helps you avoid making emotional decisions when the going gets tough.<\/h4>\n

We have no idea what the next weeks and months will bring, but 2016 has been a wild ride already. To get through it, make sure you\u2019re comfortable with your investment strategy. The rest is the discipline to keep an eye on the long term.<\/h4>\n

If you need help thinking through any of these questions or if you\u2019d like more detail on how to plan an investment strategy, don\u2019t hesitate to get in touch. I\u2019m here to help!<\/h4>\n

(1) Google Finance. <\/a><\/p>\n

.
\nWritten by Bradford Pine with Anna B. Wroblewska<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

What a difference a few weeks makes: the DOW Jones Industrial Average and the S&P 500 both fell about 10% from the beginning of the year to mid-February. Then, the DOW rallied 1,013 points or 6.53% from the low on February 11. This all happened in the space of 11 days. As of the close […]<\/p>\n","protected":false},"author":7,"featured_media":2553,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_publicize_message":"","jetpack_is_tweetstorm":false,"jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false}}},"categories":[3],"tags":[520,164,456,451,1160,1122],"jetpack_publicize_connections":[],"aioseo_notices":[],"jetpack_featured_media_url":"https:\/\/blog.bradpine.com\/wp-content\/uploads\/2016\/03\/stretched-Bradford-Pine-Wealth-Group-Garden-City-New-York-Wealth-time-to-call-your-financial-advisor-Ad.jpg","jetpack_shortlink":"https:\/\/wp.me\/p2p1nA-Fa","jetpack_sharing_enabled":true,"jetpack-related-posts":[{"id":2517,"url":"https:\/\/blog.bradpine.com\/2015\/09\/09\/its-a-volatile-market-do-you-know-where-your-financial-advisor-is\/","url_meta":{"origin":2552,"position":0},"title":"It’s a Volatile Market ~ Do You Know Where Your Financial Advisor is?","author":"Bradford Pine","date":"September 9, 2015","format":false,"excerpt":"If you\u2019re reading this, you probably know that the market has been volatile lately, to say the least. Recently the DOW was down about 14 percent off the high and the index had its worst month in over five years. ~ Do you know where your financial advisor is? When\u2026","rel":"","context":"In "Economic Notes"","block_context":{"text":"Economic Notes","link":"https:\/\/blog.bradpine.com\/category\/economic-notes\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/blog.bradpine.com\/wp-content\/uploads\/2015\/09\/businessman-head-in-sand-300x201.jpg?resize=350%2C200&ssl=1","width":350,"height":200},"classes":[]},{"id":2582,"url":"https:\/\/blog.bradpine.com\/2016\/07\/29\/building-additional-income-in-your-portfolio-how-to-invest-in-preferred-stocks\/","url_meta":{"origin":2552,"position":1},"title":"Building Additional Income in Your Portfolio: How to Invest in Preferred Stocks","author":"Bradford Pine","date":"July 29, 2016","format":false,"excerpt":"With interest rates so low for so long, I\u2019ve fielded a number of calls from clients looking for ideas for additional income\/dividends. The question is always the same: where to find it? Depending on the client, preferred stock can be a great asset class to complement the right portfolio, but\u2026","rel":"","context":"In "Retirement Planning"","block_context":{"text":"Retirement Planning","link":"https:\/\/blog.bradpine.com\/category\/retirement-planning\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/blog.bradpine.com\/wp-content\/uploads\/2016\/07\/Bradford-Pine-Wealth-Group-Garden-City-New-York-Wealth-Advisor-Preferred-Stock-300x200.jpg?resize=350%2C200&ssl=1","width":350,"height":200},"classes":[]},{"id":1290,"url":"https:\/\/blog.bradpine.com\/2011\/08\/12\/managing-market-volatility-seeking-a-little-stock-market-advice-right-now\/","url_meta":{"origin":2552,"position":2},"title":"Managing Market Volatility: Seeking a Little Stock Market Advice Right Now?","author":"Bradford Pine","date":"August 12, 2011","format":false,"excerpt":"We are all aware of the volatility in the markets. From July 22 to August 11, 2011, the S&P 500 was down as much as 18% intraday and closed down almost\u00a013%, in that time period. The market news has focused on U.S. government debt and the unfolding financial crisis in\u2026","rel":"","context":"In "Individual Investors"","block_context":{"text":"Individual Investors","link":"https:\/\/blog.bradpine.com\/category\/individual-investors\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/blog.bradpine.com\/wp-content\/uploads\/2011\/08\/daze.jpg?resize=350%2C200&ssl=1","width":350,"height":200},"classes":[]},{"id":2139,"url":"https:\/\/blog.bradpine.com\/2013\/06\/28\/the-four-financial-behaviors-that-are-sabotaging-your-portfolio\/","url_meta":{"origin":2552,"position":3},"title":"The Four Financial Behaviors that are Sabotaging Your Portfolio","author":"Bradford Pine","date":"June 28, 2013","format":false,"excerpt":"There are a lot of things you can do right in investing, and there are a lot of things you can do wrong. In the 22 years I\u2019ve been an advisor, I\u2019ve learned that much of the work of providing wealth advice is understanding the psychology of my clients. A\u2026","rel":"","context":"In "Individual Investors"","block_context":{"text":"Individual Investors","link":"https:\/\/blog.bradpine.com\/category\/individual-investors\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":2596,"url":"https:\/\/blog.bradpine.com\/2016\/11\/09\/what-does-this-election-mean-for-your-portfolio\/","url_meta":{"origin":2552,"position":4},"title":"What Does This Election Mean for Your Portfolio?","author":"Bradford Pine","date":"November 9, 2016","format":false,"excerpt":"The roller-coaster of this year\u2019s election ended last night with what most pollsters considered a surprise victory by Donald Trump. The Republican party is also in control of the House and Senate. While stock futures were rocked overnight, as of this writing (12:30 pm EST on November 9, 2016) the\u2026","rel":"","context":"In "Market Volatility & Uncertainty"","block_context":{"text":"Market Volatility & Uncertainty","link":"https:\/\/blog.bradpine.com\/category\/market-volatility-uncertainty\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/blog.bradpine.com\/wp-content\/uploads\/2016\/11\/Bradford-Pine-Wealth-Group-Garden-City-New-York-Wealth-Advisor-Donald-Trump-POTUS-election-Uncertainty-Investments-300x211.jpg?resize=350%2C200&ssl=1","width":350,"height":200},"classes":[]},{"id":2561,"url":"https:\/\/blog.bradpine.com\/2016\/04\/15\/how-to-choose-the-best-financial-advisor-for-you-looking-for-a-top-advisor-in-long-island-new-york-or-nassau-county-take-10-minutes-to-read-this\/","url_meta":{"origin":2552,"position":5},"title":"How to Choose the Best Financial Advisor For You! Looking for a top advisor in Long Island, New York, or Nassau County? Take 10 minutes to read this.","author":"Bradford Pine","date":"April 15, 2016","format":false,"excerpt":"Like anyone in business, I\u2019d like to think that I\u2019m at the top of everyone\u2019s list of potential wealth advisor. But the reality isn\u2019t that simple: working with an advisor is a two-way street, and the most successful relationship is one in which your needs and preferences are compatible with\u2026","rel":"","context":"In "Individual Investors"","block_context":{"text":"Individual Investors","link":"https:\/\/blog.bradpine.com\/category\/individual-investors\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/blog.bradpine.com\/wp-content\/uploads\/2016\/04\/profile-pic-full-size-1200x628-300x200.jpg?resize=350%2C200&ssl=1","width":350,"height":200},"classes":[]}],"_links":{"self":[{"href":"https:\/\/blog.bradpine.com\/wp-json\/wp\/v2\/posts\/2552"}],"collection":[{"href":"https:\/\/blog.bradpine.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blog.bradpine.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blog.bradpine.com\/wp-json\/wp\/v2\/users\/7"}],"replies":[{"embeddable":true,"href":"https:\/\/blog.bradpine.com\/wp-json\/wp\/v2\/comments?post=2552"}],"version-history":[{"count":0,"href":"https:\/\/blog.bradpine.com\/wp-json\/wp\/v2\/posts\/2552\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/blog.bradpine.com\/wp-json\/wp\/v2\/media\/2553"}],"wp:attachment":[{"href":"https:\/\/blog.bradpine.com\/wp-json\/wp\/v2\/media?parent=2552"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blog.bradpine.com\/wp-json\/wp\/v2\/categories?post=2552"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blog.bradpine.com\/wp-json\/wp\/v2\/tags?post=2552"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}