Stock Market is Down Over 20% - Now What?

The Stock Market is Down Over 20% since the beginning of this year, so now what?

Yes, when the stock market is down, most people’s retirement and passive investment accounts values are also down as well. So what does that mean to you and me? Well, it all depends…. How robust is your current financial plan? 

Like in life, it all comes down to how we react and make sense of things that will make all the difference. Do you see any opportunity? Or do you just see challenges and/or the negativity?

Believe it or not, you can make a lot of money too when the stock market is heading down and/or staying down because you can take on short positions and use stock options strategies to benefit. Remember, it's when the stock market is down is when you can find good companies at discount prices. When we buy stocks, the price is what we pay, but it's the value of the stock is what we are investing in.  

When it comes to investing and our investments, being aware of the current market condition is very important, however that is something we cannot control, but we can plan for it. What we do have control over is how we manage our risks and opportunity cost. It’s these two things in my professional opinion that will define our ultimate success.

How we manage our risks with the investments we make will set us up for the best chances for success. There are many factors we cannot control, so we have to take those into account and control the "how, when and what" we invest in, such as our time and money, for example.

As for knowing our opportunity costs, it's important for us to keep the perspective that there are and will always be more opportunities. It will all depend on our knowledge, experience and capacity to make certain choices that will be best for our own financial and life plans and goals.

Overall, this is why having a great personal financial education is important. So that we can be prepared for all the times that the market changes. So don't delay, get involved in the learning community and connect with me and others who share your values of learning and building personal and financial equity.