Panic

Published On: March 16, 2020

Written by: Ben Atwater and Matt Malick

As the coronavirus pandemic continues to unfold, panic is increasingly setting in among Americans.  But panic alone will not help, whether in preventing the spread of the virus or as it applies to your investment portfolio.  Prudence and time are the only answers.

Markets are always forward-looking and have a knack for anticipating events that very few individuals predict.  Once again, markets were way ahead of coronavirus.

The stock market fell apart the week of February 24th, long before people were talking about coronavirus hitting our shores and spreading throughout our country.

At the same time, financial markets anticipate a recovery long before most investors do.  The stock market will undoubtedly begin to bottom – unexpectedly – when coronavirus seems to be at its absolute worst.

The best investors are buyers on days when the market collapses.  By holding and buying more equities, these investors will far outshine the returns of the sellers and market-timers.

Investors tend to buy stocks when markets are up and confidence is high, only to sell when markets are down, and fear is rampant.  That’s a recipe for failure.

At this juncture, we are highly pessimistic about the prospects for the virus in America. Paradoxically and correctly, however, that also makes us buyers of stocks on days when markets are in full panic.

The terrible toll the virus will take is sure to reveal once-in-a-lifetime investment opportunities.

We understand this is a stressful time for all of us. We highly encourage you to please reach out to us to discuss your situation.