Financial landscapes, much like the physical world, have their seasons. While balmy days of market surges and high returns are celebrated, it’s the tumultuous storms — the downturns, crashes, and unexpected disruptions — that truly test an investor’s mettle. Successful investing, therefore, isn’t solely about reveling in sunny conditions; it’s about skillfully steering through the tempests.
Read more: Successful Investing: Navigating the Inevitable Storms1. Understand That Storms Are Part of the Journey
Every long-term investor will experience market downturns. These are not anomalies but natural, albeit unpredictable, events in the financial world. Recognizing that storms are part and parcel of investing sets the foundation for emotional resilience.
The most prominent investors in history, from Warren Buffett to Ray Dalio, have faced numerous storms throughout their careers. Yet, their long-term success is attributed not to avoiding these storms, but to how they managed and reacted to them.
2. Diversification: The All-Weather Strategy
Imagine if ships were built to only sail in sunny weather. They’d capsize at the first hint of a storm. In the same vein, a robust investment portfolio isn’t one that merely thrives in good times; it’s designed to weather varied conditions.
Diversifying investments across asset classes, geographies, and sectors is akin to building a ship that can navigate both calm and tumultuous waters. While one asset may suffer during a downturn, another might hold steady or even appreciate, offsetting potential losses.
3. Maintain A Long-Term Perspective
Storms, by their very nature, are temporary. A savvy investor realizes that downturns, however severe, are transient phases in the broader timeline of financial markets. Adopting a long-term perspective can prevent rash decisions made in the heat of the moment.
For instance, during the financial crisis of 2008, many panicked investors liquidated their assets, often realizing their losses. In contrast, those who held onto their investments or even increased their stakes during the downturn saw significant gains in the subsequent recovery.
4. Seek Expert Guidance
Navigating a storm alone can be daunting. Just as ships have experienced captains and crews, investors can benefit from financial advisors and experts who’ve weathered many financial storms. Their experience and expertise can provide invaluable insights and guidance during tumultuous times.
In Conclusion
Successful investing isn’t about hoping for an endless summer; it’s about preparing for and skillfully navigating the inevitable storms. By understanding their nature, diversifying investments, maintaining a long-term perspective, and seeking expert guidance, investors can not only survive financial tempests but emerge stronger from them. After all, it’s not the absence of storms that makes a skilled sailor, but the ability to sail through them.
_____________________
DISCLOSURE STATEMENTS
Please read the Privacy Policy Statement for our firm, including with the email/sending. If you would like a copy of our current ADV Part 2A, please contact us at info@viaiv.com, and we will send you a copy at no cost to you. You may also view our Form ADV disclosures regarding our firm online at the Investment Adviser Public Disclosure website: https://www.adviserinfo.sec.gov
The advisory firm of VIA IV Investments, LLC provides investment services by means of its own internal operation and unaffiliated third-party service and product providers (for example, your account custodian or a money manager) at your election. The account custodian processes the investment transactions for your account. This firm and the product and service providers receive and maintain information about you related to your account.
WHERE DO WE OBTAIN THE INFORMATION
The information that our firm has and uses comes directly from you. This includes such information as your name, address, and Social Security number that you provided on applications, agreements, or other forms. In addition, we maintain records of each of your transactions and holdings at the product and service provider, which are processed through this firm.
TO WHOM DO WE DISCLOSE THE INFORMATION.
We provide information about current or former clients from the sources described above to parties outside of our firm only.
To other companies as necessary to process your business. For example, we process your investment instructions through product and service providers with whom we have business agreements. The information that we obtained from you is given to the product and service providers for purposes of effecting transactions in your account and preparing your account statements. These parties must limit their use of the information to the purpose for which it was provided. Where required by law or regulation. Examples include responses to a subpoena, court order, or regulatory demand. As authorized by you. You may direct us, for example, to send account statements or other account information to a third party. As otherwise authorized or permitted by law. For example, the law permits us to respond to requests for information on you from a consumer-reporting agency.
CONFIDENTIALITY AND SECURITY.
We restrict access to information about you to those employees and authorized agents who need to know that information in order to provide products or services to you. We maintain physical, electronic, and procedural safeguards as outlined in the attached policy statement to maintain the confidentiality of your information. If you decide to terminate services with our firm or your account becomes inactive, we will continue to adhere to this privacy policy with regard to your personal, non-public information until such time as records may be legally and carefully destroyed.
Copyright © 2021. All Rights Reserved.
Jeff Holland | VIAIV
