You’ve most likely heard plenty of buzz about the “Brexit” – an upcoming vote that decides if Britain leaves or stays in the EU. When major global events like these crop up, you also most likely have some concerns about investing, and have probably wondered how you should react. After all, we live in a global economy, and political decisions can have ripples across it.
Before you make a rash decision during one of these events , consider our points on how investors should react to global events:
A smart investor tunes out the headlines
Case in point: the “Grexit.” Many headlines predicted Greece would leave the Eurozone and that there would be devastating and long-lasting effects on the economy. As we now know, Greece stayed in the Eurozone, and the US stock market eventually went on to reach new highs. How investors should react to global events should never be determined by attention-seeking headlines.
Keep your eyes on the data
Even if there’s a global event that negatively affects the economy, most investors would be better served by keeping their eyes on the data versus following their gut. Remember, good investing sometimes feels bad. Investors should react to global events by following their rational long-term plans instead of responding emotionally. For instance, the stock market has always gone on to reach a new high after even the most tumultuous global event.
How do you respond to these events?
If your gut reaction is completely change your investment strategy after a global event, and you can’t stomach sticking to your plan, consider working with an advisor. At LexION Capital, we successfully determine how investors should react to global events by crafting portfolios that reach their long-term goals and needs. If you’d like to learn more about our services and how we can help you keep your eyes on the prize, don’t hesitate to speak with us today.
