Both teams lost in their playoff games last weekend. Sports fans don’t like losses, but they understand it’s normal.
Losses are normal in your stock and bond portfolios too, but investors either blame themselves or blame their advisors, who also don’t have a magic formula to beat the market in a year like 2022. Your advisor should be talking to you throughout a downturn, and helping you to understand how your portfolio is constructed to meet your financial goals. If not, fire him or her. Now. An advisor who doesn’t talk to you is lazy (at best.)
And if you’re an individual investor who’s kicking yourself for poor returns in 2022, remember: Every sector was down, except energy. There’s no way you would have shuffled your holdings around to beat the market, when nobody else could Investors lost money last year, full stop. You wouldn’t do your own surgery – so why expect that you have the expertise to effectively invest your money to meet your goals, and beat that market every year?
But risk and reward are related: You. have to suffer some losses to ultimately get the reward. You should understand your annualized return, and not expect a return of a certain amount year in, year out. It will vary, but you’re looking for an average, over time.
To learn more about how to invest for your future without chasing stocks and while understanding how your portfolio is aligned with your goals, visit www.BlueMarlinAdvisor.com.
