How investors handle crisis: Remain calm. Stay the course.
It’s important to keep in mind that headlines are very biased. They’re made to grab your attention by highlighting only the most negative aspects of any situation, and COVID-19 was no different.
As advisors, we need to understand what’s really happening and keep our clients’ money safe.
During any crisis, we seek out those who have real economic data, in real time, on a global scale. On a financial level, while some people are doing very poorly and have suffered tragedy after recent world events, others are doing quite well.
COVID-19 caused markets to reach extreme levels of volatility. This is understandable as money moves from one bucket to another, seeking the safest place (or the next opportunity).
However, the money doesn’t disappear – its location is simply shifted around, as we acclimatize to a new situation.
When we’re in a volatile environment, advisors lean on certain investment managers and economists that we have come to trust over the years. We spend a lot of time joining conference calls and webinars during these times to make sure we know exactly what is going on, to listen to different options, and to chat with people who have access to the right data, trends, and predictions.
You must be a licensed advisor to log in to these kinds of discussions. Just as our clients trust us to be their advisors, we have our own trusted advisors as well. Our job is to leverage the information they give us, and use it to work in your best interests.
As we transition into the brighter days that appear to be ahead, COVID-19 is fresh in our minds. Even though we’re eager to leave this period of time behind us, we must remember that, historically, market corrections are normal. They are part of investing, and when the next crisis comes along, you can be sure that we will remain calm and stay the course. This is an integral part of true, long-term investing – and building wealth over time.
Written by: Wade Perkins, CFP®, Senior Financial Advisor
Spire Advisors of Assante Capital Management Ltd.
***Assante Capital Management Ltd. is a Member of the Canadian Investor Protection Fund and Investment Industry Regulatory Organization of Canada. This material is provided for general information and is subject to change without notice. Every effort has been made to compile this material from reliable sources however no warranty can be made as to its accuracy or completeness. Before acting on any of the above, please make sure to see a professional advisor for individual financial advice based on your personal circumstances.