Although financial markets tried to bounce back on Tuesday, they are basically in an extended sell-off that has punished some of the big names in the stock.
The seven-week slump in the Dow Jones Industrial Average is the longest since 2001, with the six-week rate hike in the S&P 500 being the longest since June 2011, CNBC reported.
While many investors are wondering what to do in a volatile market that saves for retirement, Warren Buffett says the answer is simple: try not to worry too much about it.
“I would say [investors]Don’t look closely at the market, “Buffett told CNBC during the 2016 Wild Market fluctuations.
Omaha Oracle added that as investors buy “good companies” over time, they will see results in 10, 20 and 30 years. “If they try to buy and sell the stock, they will not get very good results,” he said. “Money is invested by owning a good company for a long time. That’s what people should do with stocks.”
Many experts, including Buffett, recommend buying index funds, which are automatically diversified and hold each stock in an index. The S&P 500 includes big-name American companies, such as Apple and Amazon, for example.
Like Buffett, the late legendary investor Jack Bogle also recommended a buy and hold strategy. He had earlier told CNBC that buying stocks and holding them was the best way to invest because “your emotions will completely defeat you” if you try to sell your holdings to avoid losses and return later.
In 2018, Bogle said, “Stay tuned.” [like the financial crisis] পরিবর্তন Change your mind and never, ever, be on the market or out. Always be at a certain level. “
For most investors, trying to respond to market trends can be a backfire, financial experts tell CNBC Make It. It is better to wait for the market to rise and fall.
“If you’re getting a diverse portfolio, if you’re just buying something [index funds] And if you have a long enough horizon, climbing this roller coaster might be best, “said Ashton Lawrence, a certified financial planner and partner at Goldfinch Wealth Management.
Investors who sell when the market is down could actually derail their long-term plans, says Shawn M. Pearson, financial adviser at AmeriPrix Financial.
“Markets are not stable, they are stable,” he said. “While the news looks a little better, the market has already recovered. And if you miss the recovery, there’s a very, very good chance of making it harder to hit your financial goals.”
Instead, most investors may want to ignore their 401 (k) accounts instead of checking them every day, Pearson said.
“I have been a professional investor for over 20 years and I have not logged on to my 401 (k) site since its inception. [slide]”For many people, not looking at this may be the best way to help them sleep through the night,” he said.
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