When I tell people that I am an investor coach/fiduciary adviser. The typically response is to try and hide from me or simply walk away. These responses are the result of the stock market volatility during the last few of years. The stock markets around the world have been extremely volatile.
Huge moves down followed by moves up followed by moves down again and then up again. This volatility has investors on edge and looking for safety. And who can blame them. In most cases we are talking about their life savings.
These ‘investors’ are focused on short term results without regard to the long term potential. All investors need to keep in mind that they will hopefully be retired for a long time. Therefore the short term volatility is really meaningless to them. Or at least it should be.
This is where the guidance of an investor coach/fiduciary brings the most benefit to investors.
By coaching their clients about how the equity markets actually work. For example there is solid evidence that over the long term equity markets are one of the greatest wealth creation tools on the planet.
With this knowledge and the discipline to stay the course investors can realize these great returns.
“DISCIPLINE is the soul of an army. It makes small numbers formidable; procures SUCCESS to the weak, and esteem to all.” -George Washington
You don’t have to know everything about the equity markets but you do need to know the right things.
Although I don’t agree with most of Warren Buffet’s methods. That is he believes in picking stocks.
What I do agree with is that he has a process and discipline.
Most if not all investors do not have the emotional strength to remain disciplined during equity market extremes. Both up and down.
There is also a quote by the same Warren Buffet that might help some here. When everyone is crying I’m buying and when everyone is yelling I’m selling. Apparently this only hold true for his buy side. Because he also says his holding period is ‘forever’.
This sounds like market timing, which I do not believe works. That is getting in and out of the market at the right time.
I believe Mr. Buffet’s real point is do not listen to short term volatility. Stay focused on the long term.
If you can find an investor coach/fiduciary adviser to help you. You can stop fearing the markets. You can realize the great long term results. The results that can lead to your successful retirement. Both up to and after your leaving the workforce.
Your coach will among other things teach you the three simple rules of successful investing.
- Own equities and high quality short duration fixed income
- Globally diversify
These three rules may seem simple but they are very difficult to follow without an investor coach/fiduciary adviser. Especially when the media is ‘scaring’ the hell out of you.