The British World War II poster slogan “Keep Calm and Carry On” is internationally known by many and is often mistakenly attributed to Winston Churchill. While Churchill, the shrewd Prime Minister, would likely agree he did not actually pen the phrase. They are simple words meant to endure the turbulent war times. However, I feel it is appropriate and prudent advice for investors as well.
There have been many events this year including the Brexit and US election which drive home the point that Mitch Goldberg uses in his recent article to echo the WWII poster by stating in more colloquial terms “Note to investors: Freaking out is never a good option”.
When events surprise people, like the election, and the midnight S&P Futures drop of 800 points it is important to keep a calm and cool head and remember your strategy. If you are hooked on watching CNBC or any news outlet for that matter it is hard to remember that your investment story does not directly mimic what’s going on in the media but you MUST.
Goldberg states a couple of aspects of investing, which I follow as well, that help to create customized strategies to meet your specific goals:
- Timeline- know when you need to use the funds you’ve invested. That will impact the amount of risk you may take. If you need to use the funds within a 12-36 month period of time it’s best to be a bit more conservative.
- Stick to Your Guns- Holding your investments through the good times and the bad is often what creates true wealth accumulation. Goldberg says, “Time in the market is the key to long-term investment success, not timing the market”. No one, no matter how credentialed or smart, can time the market.
- Keep your Eyes on the Horizon- Our Chairman, George T. Conboy, likes to give the analogy that if you are driving in a car your keep your gaze forward and on the horizon if you are looking out the side window you will get sick. The same is true for investing. If you keep your sights set on your long term goals then you are more likely to be able to successfully accomplish them.
Working with an advisor to develop a customized strategy for your finances helps to keep you on track and in the right mind set regardless of the events, often beyond our control, that are happening in the markets and around the world. Over 70 years ago, the British got it right and Goldberg did too in 2016…”Keep Calm and Carry On”...”Freaking out is never a good option.”
Caroline Hill, Financial Advisor
(This article contains the current opinions of the author but not necessarily those of Brighton Securities Corp. The author’s opinions are subject to change without notice. This blog post is for informational purposes only. Forecasts, estimates, and certain information contained herein should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. References to specific securities and their issuers are for illustrative purposes only and are not intended and should not be interpreted as recommendations to purchase or sell such securities).