Markets and Economy Client Conversations: Don’t get distracted by news headlines

On most days, there’s no shortage of disconcerting news stories that weigh on investors’ minds. It’s natural to want to do something to protect our portfolios from loss. In times like these, it is important to view the current crises through the lens of history and remember to stay the course.

As a financial professional, you can help your clients remain on track with easy talking points from our Client Conversations series. This conversation guide covers the following points you can use to help ease your clients’ concerns about the ups and downs of the world:

While every generation has faced challenges, the market has continued to advance long-term

The US has endured multiple wars, recessions, financial panics, epidemics, episodes of political strife, and much more. Yet the market has continued to grow over time.

That’s because markets don’t trade on whether things are good or bad but rather on whether they’re getting better or worse. And for most of recorded history, conditions have improved for most.

Geopolitical events have had less impact than suspected

High-profile geopolitical events and military conflict often weigh on investors’ nerves, but they haven’t had as large of an impact on markets as many suspect. In fact, markets have tended to perform well in the 12 months following a spike in the Geopolitical Risk Index.¹

There’s often a silver lining

Out of despair often comes great innovation. Many iconic companies were born during recessions or other periods of turmoil, as challenging periods such as high unemployment often promote entrepreneurial activity.