Allianz Guru Series by Henry Yang: What to Do When the Market Swings Out of Your Favor?

So you decided to invest your money. Good! You’re on your way to making money work for you.

But lately, as you were scrolling on your device, you heard terrible news. You logged into your investment account and decided to check the value of your positions. Ack! You’re seeing red, indicating losses. You’re thinking – what can I do now?

If you haven’t done your pre-investing homework yet (Check out What You Need to Do Before Investing), now’s the best time to do it! See whether there are unavoidable expenses or payments that are needed to be done within the year. If there are some, map out where the source of funding can be – prioritize cashflows from your salary and/or business before moving on to the next source. Your investments should be among the last choices for liquidity needs since these are meant to be for long term.
If you’re worried about what’s happening in the market, there may be a chance that your positions are riskier than what you can actually take. Revisit the level of risk that you’re willing to go for. It’s easy to say that you’re a risk-taker when markets are doing well. But you could only get to test this in times of distress.
What happened in the past may not be what exactly will happen in the future. But if there’s a pattern that keeps on occurring, it may be worthwhile to pay attention. In the example below, the chart shows that there had been several challenges to investors: recessions, wars, pandemics, etc. Yet, to the diversified investor that focuses on good companies, the market would recover time and time again, and eventually bounce higher. I think this may be because of human nature where we always yearn for the better, pushing us to technological and economic progress.
S&P 500 – oversimplified represents the top 500 companies in the United States across several sectors
All of the above, can be done in a smoother manner if you talk to your financial advisor. They are experts that can help you make sound decisions.  Contact your friendly Allianz Life Changer today or watch this video from PIMCO to better understand what to do in a market that is swinging out of your favor.
Head of Investments
Henry Yang is a Chartered Financial Analyst (CFA) holder and a graduate of the University of the Philippines with a degree in Electrical Engineering. He spent the initial years of his career in building maintenance, electrical design and installation of construction projects, and teaching engineering. Later, he pursued his Master's in Business Management from the University of the Philippines - Los Baños as well as held investment-related roles at a top local bank, a U.S.-based investment company, and a global insurance competitor. Currently, he serves as the Head of Investments at Allianz PNB Life Insurance, Inc.