Investors can feel fear and anxiety when markets are volatile. The reasons for market surges and sales can be many, such as political factors, inflation concerns, trade policy concerns or tax breaks. Other possible causes include global events, economic optimism, pessimism or recession watch, or even political factors. Focusing on your financial situation and planning well can help you when the stock market is rocky.
These five steps will help you to maintain your financial stability and calm your pulse in turbulent markets.

1. Clarify your financial objectives. They will help you to weather the market volatility. Take a deep breath and create clear goals that include a timeline, price, and steps needed to reach the goal.

2. Diversify your portfolio. Concentration risk is a result of a high percentage of assets in one asset class, market segment, or investment. It can increase your losses if the market moves significantly. Diversifying across and within major asset classes is important. Do you have multiple asset classes, such as stocks and bonds or cash equivalents? Do you hold stocks in different sectors? (Biotech, consumer staples, electronics and emerging markets, to name a couple) Your bond portfolio is it diversified? By issuer, type of bond and Treasury bond?

3. Instead, go back to step 1 and be aware that strategies such as dollar-cost averaging can help you stay focused on your future. Instead, you should go back to the first step and remember that strategies like dollar-cost averaging will help you focus on your future. Dollar-cost averaging is the process of investing money at regular intervals in equal amounts rather than at one time or by automating your deposits into investment accounts. This method can help remove emotions from the decision-making process and encourages continued investment regardless of market conditions.

4. Understanding the impact of changing interest rate changes is important. Bond prices tend to fall when interest rates rise. When investing in bonds or other fixed-income products such as bond mutual funds and exchange-traded products (ETP), interest rate risk shouldn’t be the only thing to consider. Duration risk is an example of this. It is the risk that is associated with a bond’s sensitivity to changes in interest rates. To minimize the impact of changes in interest rates on your portfolio, you should research the risks associated with investment products.

5. Scammers are active in any market condition. Investors may be more susceptible to pitches that promise “risk-free” returns in times of market volatility. Phantom riches is the combination of a guarantee and a specific amount you will make. “This is a safe, secure investment that will yield you $6,000 each quarter.” By working with only registered investment professionals – using FINRA BrokerCheck, you can check if a person has been registered to sell securities – and by sticking to your financial plan, you can reduce the risk of fraud.
You cannot control the stock market; you can only control what you can. Focus on investing concepts like asset allocation and diversification to ensure your investments align with your goals.