Grow Financial Federal Credit Union
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March 8, 2022

Six Ways To Navigate Market Volatility

When a major geopolitical event occurs, investors approaching retirement may find themselves wondering what to do about uncertain markets. It’s useful to have strategies in place that prepare you both financially and psychologically to handle a turbulent market, whether it’s due to typical market ups and downs or the impact of a major world event like the Ukraine crisis. Here are six ways to help you navigate market volatility:

1. Have a game plan.

Having predetermined guidelines that recognize the potential for turbulent times can help prevent emotion from dictating your decisions. You can use diversification to try to offset the risks of certain holdings with those of others. Diversification may not ensure a profit or guarantee against a loss, but it can help you understand and balance your risk in advance. And if you’re an active investor, a trading discipline can help you stick to a long-term strategy. If you haven’t consulted with a Financial Advisor, this is a great time to do so and discuss your personalized game plan.

2. Remember that everything is relative.

Most of the variance in the returns of different portfolios can generally be attributed to their asset allocations. If you’ve got a well-diversified portfolio that includes multiple asset classes, it could be useful to compare its overall performance to relevant benchmarks. If you find that your investments are performing in line with those benchmarks, that realization might help you feel better about your overall strategy, even during volatile markets.

3. Tell yourself that this too shall pass.

The financial markets are historically cyclical. Even if you wish you had sold at what turned out to be a market peak, or regret having sat out a buying opportunity, you may very well get another chance at some point. A well-thought-out asset allocation is still the basis of good investment planning. Even if you need or want to adjust your portfolio during a period of turmoil, those changes can — and probably should — happen in gradual steps. Taking gradual steps is one way to spread your risk over time, as well as over a variety of asset classes.

4. Stay on course for retirement by continuing to save.

Even if the value of your holdings fluctuates, regularly adding to an account designed for a long-term goal may cushion the emotional impact of market swings. Particularly for those who have years or decades to go before retirement, remember that you’re playing the long game, not looking for a quick buck. Don’t give up on saving, even if you want to invest differently. Talk to your Financial Advisor about what will work best for your long-term goals.

5. Remember your road map.

Solid asset allocation is the basis of sound investing. One of the reasons a diversified portfolio is so important is that strong performance of some investments may help offset poor performance by others. Timing the market can be challenging under the best of circumstances; wildly volatile markets can magnify the impact of making a wrong decision just as the market is about to move in an unexpected direction, either up or down. Make sure your asset allocation is appropriate before making drastic changes.

6. Look in the rear-view mirror.

If you’re investing long-term, sometimes it helps to take a look back and see how far you’ve come. If your portfolio is down this year, it can be easy to forget any progress you may already have made over the years. Though past performance is no guarantee of future returns, the stock market’s long-term direction has historically been up. If patience has helped you build a nest egg, it just might be useful now, too.

Questions? Contact a CFS Financial Advisor.

Grow has contracted with CUSO Financial Services, L.P. (CFS) to provide investment services, and your CFS Financial Advisor will help you build a plan that meets your needs. The advisor will look at your current spending, saving and investing, learn about your goals and priorities, make objective recommendations and support your efforts moving forward through the implementation and management of your plan.


Non-deposit investment products and services are offered through CUSO Financial Services, L.P. (“CFS”), a registered broker-dealer (Member FINRA/SIPC) and SEC Registered Investment Advisor. Products offered through CFS: are not NCUA/NCUSIF or otherwise federally insured, are not guarantees or obligations of the credit union, and may involve investment risk including possible loss of principal. Investment Representatives are registered through CFS. The Credit Union has contracted with CFS to make non-deposit investment products and services available to credit union members. For specific tax advice, please consult a qualified tax professional.
Prepared by Broadridge Investor Communication Solutions, Inc. Copyright 2020.

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