RALEIGH, N.C. (WNCN) — Wednesday was a riveting day on the stock market, but for the wrong reasons. The Dow Jones was down 249 points after the closing bell, actually finishing better than first anticipated.
It’s difficult to say ‘stay calm’ when you see numbers like we saw Wednesday, but that’s exactly the piece of advice financial consultants say you should heed. Although the markets have declined, it’s the same volatility we’ve seen for decades.
“With the price of gas coming down and with Walmart announcing the 100 or more store closings nationally, that’s a worry sign that maybe the economy’s not doing as good as people have said it is doing,” said Pete D’Arruda, President of Capital Financial Advisory Group in Apex.
D’Arruda says with China’s sluggish economic growth and oil trading at prices lower than we’ve seen in a decade, U.S. markets are susceptible to some losses.
“It’s like when somebody gets the flu next door to you, you’re probably going to get the flu too. Or if you’re on an airplane and someone’s coughing, you’re probably going to get sick the next day. That’s what happens in the markets,” said D’Arruda.
And the signs of sickness are numerous: the S&P 500 and Dow Jones are down 10% since the start of the year, the Nasdaq is down more than 13%. But as we’ve seen, the market fluctuates drastically on a day-to-day basis.
And, if that’s what you pay attention to, you’re in for quite a rollercoaster ride.
“We’ve looked at it more like a Vegas mentality lately, I encourage everybody out there to look at it in a ten or 20 year horizon,” said D’Arruda.
However there is one group of people that might have reason to worry if the market continues to dip. D’Arruda says those who are highly invested and about to retire should get involved.
“When you get close to retirement the most important think people can do, and don’t do many times, is take some of the money off the market table and put it in places they can’t lose regardless of what happens to the market.”
D’Arruda says the best piece of advice he can give to folks investing is do not put all your money in one place: spread it around, have a good mix, and pay closer attention the closer you get to retirement.