6 tips to navigate volatile markets

When markets get choppy, it pays to have an investing plan and to stick to it.

1. Keep perspective: Downturns are normal and typically short

  • Market downturns may be unsettling, but history shows stocks have recovered and delivered long-term gains.
  • Over the past 35 years, the stock market has fallen 14% on average from high to low each year, but still managed gains in 80% of calendar years.

Past performance is no guarantee of future results. See footnote 1 for details.

2. Get a plan you can live with – through market ups and downs

Past performance is no guarantee of future results. Data source: Morningstar, Inc., 2019 (1929-2018). See footnote 2 for details.
  • Your mix of stocks, bonds and short-term investments will determine your potential returns, but also the likely swings in your portfolio.
  • Pick an investment mix that aligns with your goals, timeframe, and financial situation, and you can stick with despite market volatility.

3. Focus on time in the market – not trying to time the market

  • It can be tempting to try to sell out of stocks to avoid downturns, but it’s hard to time it right.
  • If you sell and are still on the sidelines during a recovery, it can be difficult to catch up. Missing even a few of the best days in the market can significantly undermine your performance.

Past performance is no guarantee of future results. Source: FMRCo, Asset Allocation Research Team, as of January 1, 2019. See footnote 3 for details.

4. Invest consistently, even in bad times

Past performance is no guarantee of future results. Sources: Ibbotson, Factset, FMRCo, Asset Allocation Research Team as of January 1, 2019. See footnote 4 for details.
  • Some of the best times to buy stocks have been when things seemed the worst.
  • Consistent investing can give you the discipline to buy stocks when they are at their cheapest.
  • Consider setting a plan for automatic investmentsLog In Required.

5. Get help to make the most of a down market

  • While no one likes to lose money, your financial advisor may be able to help you take advantage of a down market.
  • Tax rules may let you use losses on some of your investments to reduce your future tax bills, or use lower share prices to convert to a Roth IRA at a lower tax cost. 
  • Down markets may also be a good time to meet with your advisor to discuss adjusting your investment mix, or taking advantage of opportunities when prices are low.

6. Consider a hands-off approach

  • If you are not comfortable with market risk, consider turning your portfolio over to a professional through a managed account or all-in-1 mutual fund.
  • If you don't have a strategy, or think yours may be off track, start planning now with our online tools. Or schedule an appointment with a Fidelity representative. We can help.

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