How to Draw a Line Between Concern and Panic When Your Portfolio is Unsteady
Draw a Line Between Concern and Panic
Investing in mutual funds, stocks, real estate, gold, and more can fetch you good returns and help you fulfill your goals. Investing is essential to grow your money and build wealth. However, it is also unpredictable and unstable. The market is a volatile place that fluctuates from time to time. And this volatility can cause a rise and drop in your investments too. Getting bogged down by the losses and losing sight of what is truly important can be a recipe for disaster. Here are some ways in which you can draw a line between concern and panic and deal with an unsteady portfolio:
- Keep your eye on the long term: Short-term volatility and market crashes can be unnerving. This is also a major reason why a lot of people exit mutual funds midway. However, keep in mind your long-term goal and do not exit the scheme in between. The market works in a cyclic fashion. So, if it crashes, it will also bounce back in due time. Hence, it may be advised to stay put and not panic at every market downturn.
- Consult a professional: Irrespective of your investment acumen and experience, consulting an expert can offer you better advice and guidance. A professional financial advisor can help take the uncertainty out of the picture and offer you the right assistance on how to manage your investments for optimal growth. When you have concerns and doubts about the performance of your investments, try to talk to an expert and not take matters into your own hands. You can also use financial apps like Moneyfy to get a better idea of the various investments in the market. Financial apps like these also make investment management easy as they can be used while on the go.
- Do not look at your portfolio too often: While it is advised to rebalance your portfolio frequently and reassess your investment decisions periodically to check whether or not you are on the right track, revisiting your portfolio too often can lead to more confusion. Checking your portfolio or mutual funds returns multiple times a day or through the week can lead to panic reactions and decisions made in haste. It can also cause financial anxiety. Instead, give your portfolio some time to grow before you change a strategy or redeem any investment.
- Make sure you diversify: While the market is not in your control, your portfolio is. As an investor, the one thing that you can do to ensure favorable returns is to diversify your portfolio. Keeping the right blend of stocks, bonds, mutual funds, real estate, cash, etc., can reduce risk and lower volatility to a great extent. This also gives you more confidence in your investments and helps distinguish between genuine concern and unwanted panic.
To sum it up
Talking to a professional and using verified financial apps like the Tata Capital Moneyfy app can be the simplest things you can do to ensure that you are on the right track. Other than this, keeping a calm mind and not making decisions in haste can be sound ways to cut the noise out and not get bothered by short-term volatility.