4 Things You Should Do in a Volatile Market

Apr 13, 2020 | Blog, Blogs, Daily Financial, In the News, Market Commentary

By Terry Sawchuk

When all you hear about is market crashes, a global pandemic, and political uncertainty, it’s normal to start asking questions like, “Am I going to be all right?” and “How will this affect me?” 

And more often than not, our questions turn to financial matters: “Will my portfolio recover?” and “Will I lose income?”

While the severity of these events is not to be minimized, we can battle fear and anxiety by educating ourselves with the facts, not only with what the headlines are declaring. With the recent volatility in mind, here are 4 things to keep in mind when it comes to your finances. 

1. Don’t React; Research 

This concept applies to many areas of life, but it’s extremely valuable to remember when it comes to making any hasty changes to your financial plan. News outlets want to catch your attention, which means they are prone to exaggerate information or possibly not include comparisons that would provide clarity about what that information means. This can be frustrating.

Here’s an example of a comparison that provides some context for how things can seem much worse than they really are. The stock market dropped 7% on March 9th, 2020, which was the largest drop in over a decade. (1) But what wasn’t mentioned is that the stock market prices decreased to the same value as they were on January 9th, 2019. (2) Was anything important or scary happening in January? Nope. It was just the market fluctuation on that day.

2. Consider Long-Term Results

Now that we know to do a little research instead of making desperate moves to potentially save our money, here’s an analogy that will give us perspective as to how the stock market and our investments behave. People’s moods can fluctuate on a day-to-day basis and so can the stock market. However, if you look at someone’s personality over a long period of time, their moods average out and usually improve with maturity. This probably doesn’t apply to everyone you know but stay with me! In the same way, the stock market has shown stability over a long period of time. The value of your investments has also grown and matured with time, even with short-term ups and downs.

Here is a graph that shows this long-term stability, despite short-term market fluctuations. This is the Dow Jones Industrial Average (DJIA) over the last 30 years, which is one representation of the market as a whole if you are an average investor.

If you remember the 2008/2009 crash, as seen above, the market recovered really well. The market always recovers, and it will continue to do so.

3. Look the Other Way

If we take the information from the above two points, what’s going to happen if we ride out the waves of the stock market going up and down and keep investing consistently? We will have the opportunity to experience growth, work toward financial security, and save ourselves a lot of stress when future downturns come.  

4. Talk to a Professional About Risk

You can do all the research you want, but ultimately, it’s extremely beneficial to talk with someone who researches this information daily and can help answer concerns specific to your situation and phase of life.

Depending on your age and financial situation, you might not feel like you have as much time to let the market bounce back. This is why it is even more crucial to make sure the types of investments you have align with your risk tolerance. Lower-risk funds don’t go up and down as much as some other more aggressive-growth funds. This is something to discuss with a financial advisor to make sure your investments are where they should be and are ready for future market swings.

Are you ready to see all your options for protecting your money and setting it up to succeed in any market environment? Our team at Sawchuk Wealth would love to start that conversation and answer your questions. Schedule an initial phone consultation or call 248-269-9700 

About Terry

Terry Sawchuk is the founder, chairman, and financial consultant at Sawchuk Wealth, a comprehensive wealth management firm that is devoted to helping successful families and businesses live their best financial life. With over 30 years of industry experience, Terry spends his days helping clients pursue their financial and lifestyle goals, work toward a work-optional lifestyle, and navigate through the critical financial events of their lives. Terry’s business philosophy remains the same as it has been from the beginning: to build long-term relationships based on trust. Terry holds the NSSA (National Social Security Association) certification, as well as his Series 6, 7, 24, 63, and 65 securities registrations. In the Metro-Detroit area, Terry Sawchuk is a well-recognized name, as he was a prominent personality on radio and TV as the host of Wealth Strategies on WJR for many years, as well as a co-host of Real Estate and Business Insiders on the local ABC affiliate. Terry is a staunch advocate of the mind–body connection and is passionate about regular exercise and healthy eating. In his spare time, Terry is an avid golfer and a big University of Michigan fan. In Terry’s mind, the best thing he can do with his time is to spend it with his beautiful wife, Amy, and their five children. To learn more about Terry, connect with him on LinkedIn.


(1) https://www.wsj.com/articles/asian-stock-markets-in-early-monday-sell-off-after-saudi-arabias-decision-to-cut-most-of-its-oil-prices-11583713399

(2) https://www.macrotrends.net/1358/dow-jones-industrial-average-last-10-years

(3) https://www.macrotrends.net/1319/dow-jones-100-year-historical-chart

**The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the NASDAQ. Keep in mind that the investor returns reflect investment selection, as well as sales charges, fees, expenses, and transaction costs, whereas the Index returns do not. Indexes are unmanaged; you cannot invest directly in an index. Performance illustrated is not indicative of future results.