Stay Invested

Short-term losses can be unsettling, but markets do recover and keep growing. Holding steady through ups and downs is the best way to reach your long-term goals.

A key to successful investing is remaining focused on your long-term objectives, and not letting short-term trends distract you from your plan. Holding onto your investments when times get tough is a proven strategy for staying on track.

When people get out of the market because of a setback, they can miss out on some of the best opportunities.

Don’t let yourself get carried away by temptations or the fear of market ups and downs. You shouldn’t let negative short-term news throw you off the track of your long-term investment plans because staying invested is one of the best ways to improve your bottom line over the long run.

Retreating from your investments because of short-term losses hurts your portfolio in two ways. First, if you sell when the market dips, you are selling at a low price. In trying to avoid potential losses, you may take real losses unnecessarily. Second, history shows us that capital markets have regularly suffered losses – including some dramatic downturns – in the short term. Yet, while they don’t always move up in a straight line, markets do tend to move up over the long term.

Take the example below. Two investors start out in the same position, and their investments begin to grow. When the markets dip, one investor stays invested—and takes advantage as markets recover. The other investor withdraws from the market out of fear, and has trouble catching up.

*This example is strictly for illustrative purposes only and is not intended to be representative of the performance of any actual or future investment available to investors. Actual client returns may vary. The statements made in these examples and graphs are not to be interpreted as investment advice or a guarantee of returns or expected performance. You should be aware of the risks inherent in the financial market and discuss these risks with a qualified and registered financial advisor before making any decisions. You cannot assume that profits or gains will be realized or that any recommendations made in any part of this site will be profitable, and the contents of this site are provided for information purposes only.