Freaking Out? Before You Sell, Answer These Questions
Here are some key things to consider when thinking through investment decisions.
It's the morning after Election Day, the outcome is uncertain or disappointing, and you're kind of freaking out about how the market might react when faced with that. Your thoughts naturally turn to your investments and whether it would be better to sell to try to get out of the way of what you think could be a big wipeout in stocks and bonds.
Tempting as that seems, there's data and evidence galore showing that it's a bad idea to try to time the market in this fashion. Investors usually fail at it because markets are highly efficient, employing news and other information at warp speed and making short-term price moves very hard to predict. You're better off sticking with your long-term plan, which hopefully calls for wide diversification across asset classes anyway.