CNBC: Market shocks should be wake-up call for investors: Advisors

Share Post: facebook Created with Sketch. twitter Created with Sketch. linkedin Created with Sketch. mail Created with Sketch. print Created with Sketch.

A period of very calm and quiet trading has lulled investors into a sense of complacency that, by some measures, has not been seen in years, according to some financial advisors.

 

The recent sharp movements in markets have been a wake-up call for complacent investors, experts say. From February 2016-January 2018, volatility in the stock market was non-existent. Then, volatility came roaring back in February, as investors aggressively sold stocks after an incredible run. And now, some investors are concerned that the recent sell-off on Wall Street might get much worse and eventually that could trigger a recession.

While many financial experts believe the current sell-off in the global markets is a “minor correction,” some pundits see the increased possibility of another recession in the United States.

Billionaire investor Ray Dalio thinks there is a relatively high chance the U.S. economy will stumble into a recession before the next presidential election, in 2020.

Dalio, chairman of Bridgewater Associates, said the U.S. economy is not currently in a bubble, but he said it might not take long to get there and then to move on to a “bust” phase.

He made his comments during an appearance at the Harvard Kennedy School’s Institute of Politics.

We spoke with several members of the CNBC Digital Financial Advisor Council to weigh in on the current market conditions and the possibility of a recession.

“I really feel strongly that we’re not going to see a recession until at least a year, year and a half — maybe even longer,” said Cathy Curtis, founder and owner of Curtis Financial Planning. The U.S. and global growth are strong right now and could even be stronger next year, she added.

“So, to me, this year may again be another positive year for stocks,” Curtis said.

Ron Carson, founder and CEO of Carson Wealth Management Group, and Carolyn McClanahan, founder and director of financial planning at Life Planning Partners, both said that while the economy looks strong and earnings are growing, investors need to understand their risk and make sure their assets are properly allocated.

Carson and McClanahan agree that investors need to be prepared for any further market volatility. Investors were lulled into a false sense of market complacency over the last few years, they said.

“[Investors] need to make sure they’re aligned with their risk budget, because while fundamentals are fantastic, they’re at elevated levels,” Carson said.

“The markets have been overvalued, and now they’re [way] overvalued,” McClanahan said. That’s why it’s key that people are invested appropriate to their ability to take on risk and not on the current valuation of the market, she added.

Share:
facebook Created with Sketch. twitter Created with Sketch. linkedin Created with Sketch. mail Created with Sketch. print Created with Sketch.
Share Post: facebook Created with Sketch. twitter Created with Sketch. linkedin Created with Sketch. mail Created with Sketch. print Created with Sketch.

RECENT POSTS

Markets, Policy & Elections

You probably have questions on how the markets will be affected by the midterm elections. Will you feel policy changes in your wallet?   

Which tax-efficient giving strategy is right for me?

Watch Carson Group’s Senior Wealth Planner Ryan Yamada’s informational webinar that can help you discover which giving strategy you should pursue for tax efficiency.  

Q4 2022: Quarterly Market Outlook

Wondering what Q4 might bring? Watch Carson Group’s Chief Market Strategist Ryan Detrick’s Quarterly Market Outlook webinar for Q4, now available for viewing on-demand.   

Keys to Finishing the Year Financially Strong

It’s not too late to make some adjustments and finish this year fiscally strong. Find out how in our on-demand webinar Keys to Finishing the Year Financially Strong with Carson Group’s Senior Wealth Planners Tom Fridrich and Kevin Oleszewski.
1 2 3 31 32 33

Get in Touch

In just 15 minutes we can get to know your situation, then connect you with an advisor committed to helping you pursue true wealth.

Schedule a Consultation