Surviving Stock Market Volatility
Click on the image above to view this Savvy Minute video.
Click on the image above to view this Savvy Minute video.
This is the inaugural episode of our “Certified Financial Poetry” series.
Click on the image above to watch the video of Steve’s first reading.
Poetry and Emotion
by Steve Wolff
What a difference a week can make,
With the market’s give and the market’s take,
Last week investors were all in a tizzy,
Market volatility made them Maalox dizzy.
Down 3, down 6, down 10 percent, wow!
Is this the big break of the index called Dow?
A feeling crept in, it felt somewhat manic,
As we sat on the edge of a slight bit of panic,
Should I buy?, should I sell? What should I do?
It seems all my stocks have contracted the flu.
But here we are now, just 7 days hence,
We’ve made back some dollars and most of our cents,
Emotions can take us in all sorts of directions,
Especially when it comes to unfriendly corrections.
I’m reminded of wisdom by Alfred E. Newman,
From Mad Magazine, he shines a bright lumen,
When adrenaline pumps through your body so strong
The decisions you make will most likely be wrong,
So always stay calm and don’t be in a hurry,
And as Alfred once stated, “What, me worry?”
Steve Wolff is a Financial Advisor and Managing Partner at WWM Financial in Carlsbad California.
He can be reached at 760-692-5190
www.wwmfinancial.com
Click on image above for video
By Steve Wolff
Now for the understatement of the day…volatility has returned to the stock market.
Why has the stock market gone down with such force in the last week? I think there are a few reasons.
Unfortunately, the spike in volatility in the market has caused some of these Exchange Traded Notes (ETNs) to nosedive by as much as 80%. Because they are leveraged, the hedge funds and other investors were losing a fortune and had to cover their margin calls. How do they raise money to cover the margin? They sell stocks that they own. This is what’s known as forced selling and it is happening in spades.
Are We in A Bear Market?
Does this indicate the start of a bear market? I don’t think so because the earnings that companies just reported were pretty good. Nothing has changed with the economy in the last week, just the price of stocks.
We might be in for a few more days of this until the forced selling abates. I do not believe this is the time to do any wholesale selling because the economy is still good. The tax cuts haven’t even started to kick in yet.
The advice from us is to sit tight, stay calm and if you have the cash be ready to gobble up some good stocks that continue to be forced lower.
As always, we are here for you, so if you have any questions, do not be afraid to contact us.
You can reach us at 760-692-5190 or Steve@WWMFinancial.com