We’ve heard a lot about volatility over the last six weeks, and we often do when the S&P 500 dips. But it’s important to remember that volatility applies just as well to times when the S&P 500 is up. After all, the definition of volatility is the tendency to change quickly and unpredictably. In short, volatility is our constant companion and inherent to an investment experience in a dynamic world. It’s with this understanding that Sequoia manages your BUILT FOR YOU portfolio, managing it for volatility that swings in both directions—positive and negative.
Despite this, it’s easy to feel discouraged during times of uncertainty and less-than-favorable volatility headlines. Here are a few key points to keep in mind:
- There are many markets within “the market.” Because of this, it’s important to consider the performance of market segments. And that the market segments you own are uniquely designed to support your financial goals. We provide you with a disciplined investment strategy that accounts for volatility. Rebalancing the segments where you’re invested is one of the key tools we use to accomplish this. As a result, a headline describing the market as “down” can be deceiving since it doesn’t necessarily represent your investment mix.
- Communicate your cashflow needs with your advisor. Through ongoing conversations about your goals, we can plan for them and leverage volatility to your benefit so your plans do not need to change, and you don’t have to accept unfavorable prices that may compromise your long-term goals.
- We know the returns are there—it’s why we’re invested in equities in the first place. Electing to exit the market automatically creates a second decision—when to get back in. It is our firm belief—one that is well researched and detailed here—that trying to time the market is futile. Rebalance and adjust for your risk—of course. But don’t depend on a strategy that times the markets.
We understand the many emotions that accompany the investment journey, and we’re honored to walk alongside you through them all. We can assure you of three things: volatility is normal, the emotions you feel because of volatility are normal, and, with your partnership and candor, we know just what to do to help you navigate volatility on the path toward achieving your financial goals. Thank you for the trust you place in Sequoia. We’re delighted to serve you.
Source: Merriam-Webster, Charles Schwab
The views expressed represent the opinion of Sequoia Financial Group. The views are subject to change and are not intended as a forecast or guarantee of future results. This material is for informational purposes only. It does not constitute investment advice and is not intended as an endorsement of any specific investment. Stated information is derived from proprietary and nonproprietary sources that have not been independently verified for accuracy or completeness. While Sequoia believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability. Statements of future expectations, estimates, projections, and other forward-looking statements are based on available information and Sequoia’s view as of the time of these statements. Accordingly, such statements are inherently speculative as they are based on assumptions that may involve known and unknown risks and uncertainties. Actual results, performance or events may differ materially from those expressed or implied in such statements. Investing in equity securities involves risks, including the potential loss of principal. While equities may offer the potential for greater long-term growth than most debt securities, they generally have higher volatility. Past performance is not an indication of future results. Investment advisory services offered through Sequoia Financial Advisors, LLC, an SEC Registered Investment Advisor. Registration as an investment advisor does not imply a certain level of skill or training.
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