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Investors Need to Become More Comfortable with Volatility in Their Portfolios

By Ben Carlson, CFA
A Wealth of Common Sense

At certain points this year, the S&P 500® Index has been up 8% and down 30% from where it finished 2019. It’s currently up around 8% on the year.

The Nasdaq-100® has been up as much as 43%, down as much as 20%, and currently sits at a 35% gain in 2020.

The Russell 2000® Small Cap Index has been up as much as 2% in 2020, down as much as 40%, and currently sits at basically breakeven for the year.

The stock market has been all over the map this year.

And, while 2020 is an outlier in terms of the wild ups and downs, volatility is something every investor is going to have to get used to in the coming years. You simply have to be willing to accept some form of volatility if you would like to earn anything on your capital. Volatility has always been part of the markets, but more so now than at any other time in history because interest rates are on the floor.

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z - Cover Image: Investors Need To Be Comfortable with Volatility