You may have noticed the stock market taking a sluggish turn during the summer. The trading volume decreased, and the numbers haven’t been quite as strong as in pre-summer months. Don’t fret!

At times like this, it’s tempting to grab your money and take it out of the market. Don’t. The smartest investors are NOT jumpy investors. They are the ones that ride the highs and lows, fully aware that they are treating their investment like a marathon, not a sprint.

Besides, markets are historically slow during summer months. Just like people, the stock market has a rhythm (which may or may not correspond to the seasons—some sources claim that the summer slowdown is a fallacy).

What does summer mean to you? If you live in the Midwest like I do, it means you might spend less time in the office and more time at the cabin, in front of the grill, or hiking in the woods. It’s also typically a time when children are not in school; they’re away from their desks and are (hopefully) spending time just being kids—playing games, swimming, and letting their creative sides loose.

In fact, as adults it’s hard to break the pattern of “work during the ‘school year,’ play during the summer.” From a very young age, we’re trained to cycle through the year in this manner. Similarly, the stock market may take the occasional break. Sometimes this sluggishness aligns with the summer months, sometimes it occurs for other reasons. As a financial advisor, the best advice I can give you is to keep calm! We’ve never been stuck in a permanent downturn and there is no reason to believe we ever will be.

It’s with good reason that financial advisors are eternal optimists. We’ve studied the stock market, we pay attention to it every single day, and we are well-aware of its resiliency. Yes, it has and will continue to experience downturns, but it is ultimately a beast that likes to grow.

So, when you’re noticing a summer slump or a winter chill hitting the market, remember my advice and don’t panic. In fact, if you need to, take a break from checking the market’s performance. By distancing yourself, you’ll allow your rational side to kick in and hopefully you’ll view the market with a little more objectivity.

Remember: the stock market likes to cycle. Just like people, it occasionally needs to take its foot off the gas pedal and coast for a little while. But don’t worry, it’s general trajectory is forward.

Leave a Reply