Market volatility and your investment goals
Important investment principles to remember
As an investor, there are several important investment principles to remember during a period of market volatility. A few of these principles include:
Invest for the long term
Focus on your long-term investment goals and not on how to avoid a short-term downturn. The market will fluctuate up and down over time. Remembering to focus on the long term will help to minimize your concerns about daily fluctuations.
Diversify your investment portfolio
Investing in a variety of stocks and bonds can help you reduce the risk associated with putting all of your eggs in one basket.
Regular investing through a periodic investment plan allows you to buy more shares when the price is low and less shares when the price is high – helping you reduce the average cost of fund shares over a long period of time. This process of regular investing, when used regardless of fluctuating price levels, is called dollar-cost averaging. This can be done easily with a periodic investment plan with State Farm®.
It will not assure a profit or protect you from a loss. It's simply a way to average out the cost of fund shares as the market fluctuates when investing for the long-term.
Automatic investment plans do not assure a profit or protect against loss.
Diversification does not assure a profit or protect against loss.
Securities are not FDIC insured, are not bank guaranteed and are subject to investment risk, including possible loss of principal.
Securities distributed by State Farm® VP Management Corp.
Neither State Farm® nor its agents provide tax or legal advice.