Broker Check

Logic vs. Emotion

Written by: Core Financial Group

If you have had the opportunity to save some of your hard-earned dollars and invest them in the market, you have probably heard the phrase buy low and sell high.  It makes sense, when given the opportunity to invest in something the goal is to buy it at the lowest price possible and sell it at the highest price possible.  Simple, right?

The problem lies not in the logic of this concept but in being able to handle all the emotional stresses that come with investing in the market.  I have heard many times over the years “I will start saving again once the market recovers” or “let’s see how my investments do over the next few months and then I will get back in.”  While we understand this on an emotional level, logically these comments go against the buy low – sell high process. 

 How do we as advisors help people overcome the emotional side of investing to develop a plan that allows them to continue investing through highs and lows of the market?  We must have a long-term perspective.  We are not worried about the next 10 days, 10 months or even the next year.  We have a long-term perspective with our clients’ goals in mind that allows us to navigate market movements logically and make changes when they are necessary, not out of emotional response to market movements. We diversify among asset classes.  Not all investments move in the same direction at the same time, so owning different investments for different seasons of the market allows our clients to stay the course and focus on their long—term goals.

 While no one has a crystal ball and can time the market perfectly we can be logical in our approach to your long-term goals and allocate your dollars so that you can stay invested.  There are always risks when investing the market, but with a disciplined approach and a trusted advisor you will have the ability to navigate all types of markets and stay the course to reach your financial goals.

 If you would like to learn more about our process and how we help clients create more confident financial futures reach out today to schedule a time to connect.

A diversified portfolio does not assure a profit or protect against loss in a declining market.