Broker Check

The Unemotional Investor

It can be difficult to not get emotionally caught up in the ups and downs of the investment markets when it’s your money that’s on the line. If your investments are up, you might become overconfident. And if they drop, you might panic. The investment decisions you make when you’re overconfident or panicking may very well not be the best decisions for your situation.

Think Before Acting

If an investment suffers a loss, your first reaction may be to immediately get rid of it. However, that may not be the best course of action.

Take the time to look at the investment’s long-term performance relative to its benchmark. Consider how the investment fits in with your portfolio’s objectives and time frame. Unless there are convincing reasons to sell, you may be better off sticking with your original investment strategy for the time being.

Focus on the Facts

It may be human nature to follow the crowd. If everyone else is excited about a particular investment, you probably don’t want to miss out on this next big thing. Yet following the crowd when investing may not be the best choice. By the time you hear about the latest, greatest investment fad, it could be too late to benefit from any investment growth. Plus, if it sounds too good to be true, it probably is. Your best bet may be to focus on the facts and follow your investment strategy, not the crowd.

Keep Your Perspective

Don’t base your investment decisions only on current market conditions. Instead, look at the market’s historical performance to give you perspective. Even a quick glance will tell you that both bull and bear markets have occurred over the years, so whatever is happening today may be different tomorrow.

Get Your Head Out of the Sand

Sometimes, an investment does take a long-term turn for the worse. Or, it no longer fits your investment strategy. You may find you’re reluctant to act when it’s time to sell an investment. Perhaps you feel emotional about the investment because a family member recommended it or because you’re familiar with the company name.

But holding onto an investment for emotional reasons could hurt your portfolio’s performance. You shouldn’t avoid making the hard decisions when you’re investing for your future.

If you’re having trouble being objective, we can help. As your financial advisor, I can help you make investment decisions based on facts, goals, and time frame, not on emotions.

Content written by Newkirk®, as distributed to Symmetry Partners, LLC. Our firm utilizes Symmetry Partners, LLC for investment management services. Symmetry Partners, LLC, is an investment adviser registered with the Securities and Exchange Commission. The firm only transacts business in states where it is properly registered, or excluded or exempted from registration requirements. All data is from sources believed to be reliable, but cannot be guaranteed or warranted. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Symmetry Partners LLC), or any non-investment related content, made reference to directly or indirectly in this article will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. The article contains the opinions of the author(s) but not necessarily Symmetry Partners, LLC. Please note that you should not assume that any discussion or information contained in this article serves as the receipt of, or as a substitute for, personalized investment advice from Symmetry Partners or your advisor.

Joshua Farmer is a Registered Representative with, and securities are offered through LPL Financial member FINRA/SIPC. Neither Brookstone Wealth Management nor LPL Financial provide tax or legal advice. Securities and financial planning services are offered through LPL Financial, a Registered Investment Advisor, Member FINRA/SIPC.