September 2024 Newsletter:
Wisdom & Wealth
We Asked Our Team: What’s Your Perspective On Market Volatility?
From crunching leaves to crunching numbers, our team is embracing this season’s changes. Read on to hear how Hess Financial tackles market volatility with fresh perspectives and insights.
Kevin Flint
CFP®
While fall in the Shenandoah Valley is beautiful, it’s historically a challenging period for financial markets. September and October have seen some of the most significant stock market corrections over the years. Although this doesn’t guarantee that we experience a rough patch this fall, even with an election on the horizon, we don’t wait for volatility to strike.
By using our bucket approach to risk management, we ensure our clients always have sufficient cash and lower-risk investments to support their needs during market downturns. This strategy helps prevent market fluctuations from affecting our clients’ lives. We never want clients to pass on a trip or something important to them while they wait for the market to recover. Though market volatility can be unsettling, with careful planning and risk management, it can be navigated effectively.
Stephan Hess
CFP® CDFA®
There was a time when I feared market volatility because in my mind it always was correlated with loss. Now I only see it as opportunity. I’ve learned that growing your wealth isn’t dependent on only having fair weather markets. In fact, corrections and recessions can provide some of the best opportunities to increase long-term average returns. Notice the emphasis on Long-Term returns. Whether the markets are acting irrationally exuberant, or temporary fear has gripped them, attentive money managers like to use these extremes to protect gains through careful rebalancing or putting more money into their best ideas when they go on sale.
It may not immediately pay off, but as a market cycle runs its predictable course, it offers the opportunity to take advantage of volatility in a unique way and boost performance. Accept volatility, live with volatility, and profit from volatility.
Derek Hess
CFP®
As many of you may know, being an investor is difficult for many reasons and can be quite humbling. While it has become much more accessible and easier to do with the help of technology, the emotional rollercoaster is still very much part of the investing experience. You know what’s interesting to me about rollercoasters? The fact that everyone is quiet with anticipation on the way up. Then all the sudden you cross over the peak, and everybody starts screaming and you may even look over and see people with their eyes closed. There are sharp and fast drops, twists and turns and maybe all while being upside down! This is a bit of an exaggeration, but the point is, I like to use this analogy because I feel there are many parallels to the investing experience.
Everyone is happy when the market is slowly and steadily going up, but the reality is that this isn’t normal behavior in the short-term. The tricky part is coming to terms with the fact that there are always going to be drops and twists on this ride. After all, nobody gets on a rollercoaster because they’re slow and predictable, right?
Let’s Decode The Headlines
Check out Hess Financial’s Recent Blogs
Our goal is to decode the stories you see on the news into simple and straightforward concepts that are easy to digest. Let us know what you think!
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September 2024 Market Update
