Investors are leaving the market
Sept. 9, 2103
by Brian Wolf
When it comes to investing, history has shown that some people will do the wrong thing at the wrong time.

It’s easy to get your investment advice from media or Internet outlets. And when you rely on this information, sometimes it might be dated, or at least from a timing aspect too late to make a positive difference in your portfolio.

Remember, you’re not the only one listening to the financial news of the day. And even if you hear the news, that’s often just the beginning. How do you know what to do if interest rates are rising, or what to do if a war breaks out somewhere in the world? In other words, it’s very difficult, to say the least, to know what to do in times of uncertainty. With the world markets now linked together like never before, the challenges of where and how to invest are as great as ever.

So, what’s going on right now?

Well, August hasn’t been good to the market, and investors are apparently reaching their sell point. According to an article from Investment News, Aug 23, 2013 (http://www.investmentnews.com/article/20130823/FREE/130829957#), investors are leaving stocks in numbers that we haven’t seen since 2008.

From the article:

“Domestic stock funds last week suffered their worst week since before the financial crisis as investors’ fears over the Federal Reserve’s plan to cut its asset - purchasing program spread to stocks. More than $14 billion was pulled out of US stock funds this week, the most in a single week since June 2008, according to Bank of America Merrill Lynch.

The S&P 500 is down almost 3 percent since the beginning of August, although it’s still up more than 15 percent year-to-date. The pullback gained steam, ironically, after a report that initial jobless claims had fallen to their lowest level since before the financial crisis. That fit in perfectly with the consensus opinion that the Fed would begin to taper its asset purchases at its September meeting.

Now that we have the above information, what should we do about it?

It’s a fact that things are changing. But does this mean that you should change your investments now also? Perhaps the best advice would be to take another look at what your real objectives are in the first place.

How much gain do you really need or want? How much risk can you afford to take? Many of my clients will put money into safe products that they can’t afford to lose. After that is taken care of, they will then risk some of their money in the markets with a professional money manager who will decide when to be in the market, or not.

If you would like to explore this type of portfolio management, give us a call and I would be happy to share that with you. As far as the current markets are concerned and how that will affect your portfolio . . . only time will tell.

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