Stressed about the stock market? Read this to relax

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bushwick
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Registrado: Sab Feb 23, 2019 16:56

Stressed about the stock market? Read this to relax

Mensaje por bushwick » Lun Mar 16, 2020 11:40

La newsletter 'Smarter Living' de The New York Times trata esta semana sobre el estrés de ver cómo bajan las bolsas. Dejo aquí el texto que han publicado, con varias voces de expertos, algunos de ellos Bogleheads. Está muy bien.

You already know the rational steps to take during a financial crisis: Don’t look at your 401(k) or investment accounts. Don’t stay glued to CNBC or the financial press. And, above all else, do not panic-sell your investments.

And yet: As Mike Tyson put it, everyone has a plan until they get punched in the mouth.

A generation of investors is experiencing its first genuine financial crisis. For many millennials — including yours truly — no amount of rational thinking can ease the pain of the first time you watch a fifth of your life savings evaporate in a few weeks.

To guide us through that pain, I called some seasoned investors who have been around this block before, having seen crises reaching back to Black Monday of 1987. They’re here to offer calm, perspective and a few tips on dealing with the crisis, mentally and emotionally. (Answers have been edited for length and clarity.)

Don’t let emotions win over reason

Mel Lindauer, co-author of “The Bogleheads’ Guide to Investing”: “The only two days that really matter in investing are the day you buy and the day you sell. All the ups and downs in between are simply noise. If you can learn to ignore the noise and stick with your investment plan, you’ll do just fine.”

Brian Preston, C.P.A., C.F.P., P.F.S., and host of the YouTube channel and podcast “The Money Guy Show”: “Creating wealth is simple — buy the market while you are young, and let compounding growth do its magic. However, wealth creation is not easy. You have to fight all of your human instincts and build a worldview that is separate from the herd. That is hard the first time you experience irrational behavior and whipsaw markets.”

Deena Katz Evensky, professor emeritus in the department of personal financial planning at Texas Tech University: “Panicking will only create more sleepless nights for you. Maintain a ‘buy and hold’ mind-set. The best thing you have going for you right now is time. Don’t try to time the market. You must stay in the market to get market returns. Remember, you are buying companies, not just stock. Businesses are still running and the world is still operating.”

Tune out the news

Ms. Katz: “Stop listening to or reading financial pornography. If these guys were so smart, they wouldn’t be working for a living. Watching extreme volatility on a daily basis will give you ulcers and sleepless nights. A calmer long-term perspective will take you far. And don’t get angry or beat yourself up with ‘would have, should have’ — but remember that all investments have risk.”

Mr. Preston: “You can reach a certain point where staying up-to-date on the latest news and information is doing more harm than it is good. You’ve got to separate the actionable information from unactionable information; news about school closings or advice from health officials is good, actionable information. News about market drops or volatility can be valuable information, but not necessarily actionable. Much of the news about the market and coronavirus is great for staying informed and up-to-date, but may not be great for your sanity and financial health.”

Farnoosh Torabi, financial writer and host of the podcast “So Money”: “Unsubscribe from the push notifications. Why do this to yourself? There’s no value in getting daily market updates if your intention is to invest for the very long run. The market will have good days and bad days and terrible days. There’s absolutely no benefit in putting yourself on high alert with every move that it makes.”

Remember: This isn’t our first rodeo

Ms. Torabi: “If we recall, the 20th century had its own host of problems and tragedies. It’s not that I encourage everyone to have all this blind faith in the stock market. Instead, have faith in the human race and its proven ability to adapt, invent, transform and make the world a better place. And that, in the end, is what fuels a strong economy and financial market.”

Mr. Preston: “This downturn does not feel any different to me than any other periods of panic and wild swings. Whenever I hear ‘new paradigm’ or ‘this time it’s different,’ I internally smile and know that we are humming the same song, and that I have been here before.”

Ms. Katz: “Worldwide chaos and terrible news have been around forever, and somehow we live though it. Imagine what your grandparents felt during World War II or what your parents thought when President Kennedy was killed or the Vietnam War raged for years.

“There are two ultimate outcomes: We all get through this, or everything falls apart. If everything falls apart, it won’t matter. If we get through this, you have a pretty good chance of seeing things go back to normal, even if it’s new normal.”

Pepeco
Boglehead
Mensajes: 168
Registrado: Vie Ene 04, 2019 17:12

Re: Stressed about the stock market? Read this to relax

Mensaje por Pepeco » Lun Mar 16, 2020 21:38

Muy bueno, gracias por compartir.
"There seems to be some perverse human characteristic that likes to make easy things difficult." - Warren Buffet. Hazlo simple.

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