Mutual funds for every objective
Mutual funds come in a wide variety of styles to meet the varying needs of investors.
Mutual funds come in a wide variety of styles to meet the varying needs of investors.
04/23/2024
INVESTING ESSENTIALS
When the stock market starts to fluctuate, do you get the urge to move your funds in the hopes of boosting your returns?
Resist that urge. Because while attempting to time the market may boost your returns initially, it could also hurt you financially in the long run.
Let’s start with a definition. Market timing is the act of moving money in and out of the financial markets or switching between mutual fund asset classes, while trying to predict the future direction of the market. In other words, it involves making a series of decisions based on an endless cycle of fickle market and economic conditions.
Before giving in to the lure of market timing, here are some of the important factors to consider:
Volatility in the market often tests the resolve of investors. The more volatile the market, the more likely investors are to shed their stocks and head to the sidelines. However, you should keep this in mind:
A better approach: Treat stock market investing like the long-term strategy it is. Choose carefully. Be patient. And if you’ve done your homework, chances are the market will do what it’s always done—over time. If you’re going to move your funds, move them strategically in a way that is consistent with the asset allocation that fits your investing objectives and risk tolerance.