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What Should You Do When the Market Dips?

Your heart might have skipped a beat when the Dow dipped 1600 points Monday.

And if you called your financial advisor, you probably got the same message: there’s no need to worry.

We reached out to several financial advisors today to better figure out what’s happening with the stock market. Apparently, they’re on the phone with people like you who are trying to make sense of what went down.

Greg Debski, a certified financial advisor and portfolio manager at Naples Global Advisors, took a quick moment from his busy day to talk to HelloSWFL about what “might” be happening.

FEAR OF INTEREST RATES RISING

“If I were to guess, it’s anything from people starting to get concerned with interest rates actually rising,” Greg explained. “It’s been low for years and it’s time for interest rates to go up.”

VOLATILITY TRADING = BAD TRADING

“The fact that last year was such a quiet year people started betting that we would never going to have volatility again,” Greg continued. “That’s what I think happened in the last few days, people just get caught in bad trading.”

TWO THINGS YOU CAN DO NOW?

No.1

If you have money in the stock market, Gregg said investors should focus on asset allocation. You should make sure you have a diverse mix of investments in stocks and bonds.

No. 2

Keep tabs on what’s going on within the companies you’re invested in. How are those balance sheets looking? Are they strong? Are the companies growing domestically and internationally?

This is not the first time the market has gone down, and it probably won’t be the last. If your assets are set up correctly, this is all part of the game.

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