With the recent military actions in Iran, a lot of clients may be wondering, “How will my portfolio perform during a war?” We do not have a crystal ball, but we can look back at history and see that the market has overcome countless hiccups and major conflicts in the past despite plenty of headlines that cause concern. Every year, there is uncertainty surrounding the economy, taxes, geopolitical issues, and a host of other concerns. To be a successful investor, we believe that you should robustly diversify so that all your investments are not dependent upon a few companies or a small part of the overall world market. The chart below shows major headlines and concerns for the past 55 years.
Instead of trying to time markets, you would be better served focusing on areas that you CAN control such as your personal savings rate, diversifying to reduce risk, reducing your tax burden where possible, and sticking to your overall financial plan.
Tune out the short term noise of the market and focus on the long-term potential for your investments to grow if you stay disciplined.
