Maintaining perspective in the information age

Jul 30, 2018
Business people on smartphones

In today’s fast-paced information age, we are bombarded 24 hours a day with investment advice – online, via television and radio, and in the business press.

With so many sometimes-conflicting opinions floating around, you may be wondering who to listen to. Even the most level-headed investor may feel anxious. What is a long-term investor to do?

Tune out the noise

First, it’s helpful to anchor your thoughts on the basic principles of sound investing. Invest regularly in a well-diversified portfolio that reflects your goals, time horizon and risk tolerance and stick with it.

Second, understand why these basic principles aren’t common news items. The answer is simple. It’s the thrilling stories and dire predictions that grab attention and dominate the headlines.

This is not to suggest that you should ignore all market news or advice. Just be aware that, typically, more information in the news media is directed toward active investors and day traders than to traditional investors. Short-term advice may suit aggressive investors, but it’s rarely helpful for long-term investors following a customized investment plan.

Focus on the long term

Think for a moment of your investment portfolio as another of your key investments — your house. Do you check the value of your house every day, week or month? Probably not, but that doesn’t make you anxious about your real estate investment. You know that your house is likely to increase in value over time.

If an item in the financial news makes you think you should change your portfolio or take advantage of a specific opportunity, talk to us. We will help you separate the news from the noise and make sure your portfolio is aligned with your investment objectives.

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