The Dilemma Facing Investors

 

Individual’s and large intuitions face the same issue. How to balance risk, reward and time. Striking a positive balance between risk and reward and time is critical to achieving long-term investment success. However, investors face a wide variety of obstacles in achieving that balance. Dealing with emotions is the number one issue. When the market declines fear sets in. When the market is on a run-up people think they are bright they get greedy. Everyone wants more. Decisions tainted by fear or greed may harm the investor’s long term financial goals. Historically investors have continually chased performance, investing heavily at market peaks and selling and abandoning the market after declines. As a result, investors tend to have difficulty achieving their goals. We believe most investors would benefit from having a team of experts who provide guidance, helping them stay on course while pursuing their investment objectives. Almost all investors want positive performance with low risk. With this in mind, Strategic Wealth Advisors seeks to provide investment strategies that are tailored to the unique needs of an individual investor. Balancing risk and reward is a key component of our strategies. The dilemma facing investors explains why many investment decisions are driven by emotions. Investors are trying to accumulate enough assets to meet their personal financial goals. On the other hand investors want to protect their investments from decline. And, depending on your age and life line time can be an issue. Do you have time to weather the storm and fulfill the purpose the money was intended for? When markets decline it is tempting to sell. This can be self-defeating as opportunities may be missed. We need a plan or approach that plans for good times and difficult times. The most sensible way investors can attempt to reduce emotional risk is by employing a trusted financial advisor, one who has developed a framework for financial decision making and who provides clients with ongoing perspective and encouragement. That advisor may help a client develop and build confidence and stay committed to long term goals.

What is the purpose of your money? Does your investment Policy Statement support your purpose? What are the criteria for change? What is the time horizon?

If you have concerns please call and we can review the purpose of your investments and investment Policy Statement. Do they match? Should a change be discussed or made? No obligation!