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FINANCIAL CORNER JESSE RIGLER
VOTE FOR SMART TINVESTMENT MOVES
HE PRESIDENTIAL ELECTION IS much about what happens in Novem- little more than a month away. ber. Instead, follow these investment Like all elections, this one has gen- strategies:
erated considerable interest, and, as a cit- izen, you may well be following it closely. But as an investor, how much should you be concerned about the outcome?
Probably not as much as you might think. Historically, the nancial markets have done well – and done poorly – under both Democratic and Republican admin- istrations. Also, many factors a ecting investment performance have little or nothing to do with the occupant of the White House. Consequently, no one can claim, with any certainty, that one can- didate is going to be “better for the mar- kets” than another one.
Still, this isn’t to say that any given presidential administration will have no e ect at all on investors. For example, a president could propose changes to the laws governing investments, and if Con- gress passes those laws, investors could be a ected.
But in looking at the broader picture, there’s not much evidence that a par- ticular president is going to a ect the overall return of your investment port- folio. As mentioned above, many factors – corporate earnings, interest rates, for- eign a airs, even natural disasters – can and will in uence the nancial markets. But in evaluating a president’s potential e ect on your investments, you also need to consider something else: Our political system does not readily accommodate radical restructuring of any kind. So it’s di cult for any president to implement huge policy shifts – and that’s actually good for the nancial markets, which, by their nature, dislike uncertainty, chaos and big changes.
The bottom line? From your view- point as an investor, don’t worry too
• Stay invested. If you stop investing when the market is down in an e ort to cut your losses, you may miss the opportunity to participate in the next rally – and the early stages of a rally are typically when the biggest gains occur.
• Diversify. By spreading your dollars among an array of investments, such as stocks, bonds and other invest- ments, you can help reduce the possi- bility of your portfolio taking a big hit if a market downturn primarily a ected just one type of nancial asset. Keep in mind though, that diversi cation can’t guarantee pro ts or protect against all losses.
• Stay within your risk tolerance.
Investing always involves risk, but you’ll probably be more successful (and less stressed out) if you don’t stray beyond your individual risk tolerance. At the same time, if you invest too con- servatively, you might not achieve the growth potential you need to reach your goals. So you will need to strike an appropriate balance.
• Forget about chasing “hot” stocks.
Many so-called “experts” encourage people to invest in today’s “hot” stocks. But by the time you hear about them, these stocks – if they were ever “hot” to begin with – have probably already cooled o . More importantly, they might not have been suitable for your needs, anyway. In any case, there’s really no “short cut” to investment success.
Elections – and even presidents – come and go. But when you “vote” for solid investment moves, you can help yourself make progress toward your nancial goals.
Jesse Rigler is a nancial advisor at Edward Jones in Kalispell.
TOUR of the ARTS
Free self-guided tour featuring 25 artists, 3 galleries and 3 historical museums.
Visit AlpineArtisans.org or call (406) 754-0034
in the Seeley-Swan and Blackfoot Valleys
OCT 8 and 9, 10am - 5pm
SEPTEMBER 28, 2016 // FLATHEADBEACON.COM
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