Dividend Investing Ideas Center
Have you ever wished for the safety of bonds, but the return potential...
The dog days of summer are upon us, and as we highlighted earlier, the summer months have generally been unkind to investors with low trading volumes and occasional spikes in volatility making for lackluster returns.
All in all, summer can be a real drag for investors, in every sense of the word. For starters, subdued trading activity can be frustrating for those who always have an urge to do something for their portfolios; this type of environment can in turn prompt erratic decision making, which more often that not will quite literally drag down your overall returns in the long run.
Our advice for dealing with the summer slump is simple: be productive, not reactive.
Low trading volumes and occasional spikes in volatility are a dangerous combination because they can lure even seasoned investors into making erratic, emotionally induced decisions. To avoid this sort of temptation, we highlight three ways to focus your energy and channel your urge to do something productive rather than reactive:
Avoid the temptation of buying or selling just for the sake of feeling like you’re doing something useful for your portfolio. Remember that abandoning exposure is costly and if you must tweak your portfolio, consider scaling in or out of positions gradually rather than pulling the trigger on a big order all at once.
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