6 things im doing to deal w/ stock market downturn and my anxiety from it
not for everyone, just my plan to deal with these uncertain times
- Get into right mindset. Markets 📉💨 , but they do recover & then some. This experienced truism keeps me 💆♂️ in important days ahead. Cant let emotion creep into decision making. natural to be led by 😨 Remain calm & 🤔long term
- Don’t panic sell. As tempting is to sell to ✋️carnage, just remember not a loss unless you sell. Starting 1930, BoA found if investor missed S&P 500’s 10 best day in each decade, total returns would be just 91%, below 14,962% return for investors who held steady thru 📉
Selling & then buying back when 🤔 normalcy has returned will result in ⬆️ likelihood of missing some of 10 best days that will occur over decade. Only sold names no confidence in. bad co's will be hit hard during tough times. free up 💸 2 purchase good co's selling @ discount
- Re-assessing my risk tolerance. Major market 📉 reveal ur true risk tolerance. We all want to say we can take on some risk in exchange 4 ⬆️ return only when our portfolios 📉 10% in day & 30% in month that resolve is tested. Using 📉to rethink my tolerance for risk
I am able 2 tolerate short-term pain and can take on risk knowing rewards will come.
Im following legendary investor Warren Buffett’s advice:
“Be greedy when others are fearful"
Be honest w/ self. whatever ur truth is whats right for u.
- Selling some fixed income & real estate 2 free up 💸 2️⃣ buy👍 co's on sale
this is definitely not for everyone
Intend to build normal allocation back up 2b commensurate with my risk tolerance and life stage.
Unique ⏲️ & I want to be on 👉 side of what could end up being 1️⃣ of largest wealth transfers in history
- Dollar cost averaging in..
Dont know when we will hit bottom, will buy over small increments over next 6+ months
- Buying great co's at discount. You know those amazing companies that you have been kicking yourself for not getting in on earlier. Where the price was so expensive that it stopped you from buying. Well, im dusting my list off. ⏲️ like this are when investing careers are made.
ive published my two model portfolios here https://www.thewealthyowl.com/modelportfolios