Why It’s Good News that Investments Go Up and Down
Mr. and Mrs. Client, on your way to meeting your goals, your investments will go up and down in value. Now I understand everyone’s game plan is to buy something that goes up. That’s about the extent of the plan. The reality is investments go up and down in value.
What we have to realize is volatility is not risk. Volatility is volatility.
It’s not a loss, we don’t lose something until we sell. But the fact is, stock markets are volatile, short and medium-term. We know that. But the longer time horizon we have, the more comfortable we become with the ups and downs.
Fluctuations are opportunities.
Now I’ll just use mutual funds as one example. Let’s say a share of a mutual fund pays a dollar in dividends. And you want to retire on $50,000 a year in income from mutual funds. So when I ask you, how many shares you have to own, you say:
“That’s easy! If a share pays a dividend of a dollar, and I want $50,000, I have to buy 50,000 shares, Don.”
I’d say that’s right and I would ask you: “When do you want to buy the shares – when they’re up or when they’re down?”
“Well, when they’re down.”
The good news is, investments go up and down, not up and up.
And if we’re truly a believer, and truly committed to long term, we’ll be buying on the downs, adding to our account.
If, after all of this, you specifically want to explore one type of solution Don stands behind…
A Practical Resource for Advisors Navigating Today’s Client Conversations
When markets shift, emotions rise, or clients hesitate, many advisors find it helpful to have a clear framework to guide the conversation.
Don Connelly has developed a structured resource to support advisors in situations like these — grounded in real-world experience and designed to bring clarity and confidence to the moments that matter most.
If you’d like to explore practical ways to help clients stay focused and confident during periods of market volatility, you may find the Volatility & Bear Market Toolkit™ helpful.
