Dear Friends and Family,
The news media is consumed with the coronavirus as it progresses both nationally and globally. It’s only natural for situations like this to, in some sense, paralyze us with fear! We should be concerned and act rationally to take every precaution necessary, both regarding the virus and our investments!
I wish I had a $1, for every time someone would tell me, “This time is different” as a reason for getting out of the stock market. Examine the charts below and you decide if it really is that different this time.
I’ve been committed to serving this community for over 35 years and very early in my career I learned that I can not predict or control the stock market and what it will do on any given day. But what I can try to control are my emotions, especially the emotion of fear. Fear is the single most motivating emotion you and I have. We will do things under duress of fear that under normal circumstances we would never do. And when we commingle fear with our decision-making process, especially as it pertains to our finances, we are destined to lose! Fear is mentioned 478 times in the Bible. Most every time, God and Jesus are counseling us to fear Him only and to not fear man or circumstances that come our way!
Studies going back, long before I got in this business, repeatedly show that 87% of investors do not stay invested. The market drops, fear takes hold, and they sell, locking in their losses and adversely impacting their long-term rate of return.
Logically, we know we want to sell when our investments are up and buy when they are down. Fear and logic rarely go hand in hand.
An American philosopher, George Santayana once said, “Those who can not remember the past are condemned to repeat it.” Let us, this time, not be part of that 87% that allows fear to prevail and sell good investments.
Stay the course and I assure you; you will end up a winner!
Michael P Eischen, MSFS, MRFC, ChFC, CLU, CFS