The media is strangely (frighteningly?) powerful here in the United States. Investors are bombarded all day with urgent emotional calls to action. “This election is a doomsday scenario. Do this specific thing right now, before it’s too late!”

That kind of sensory overload can talk some people into believing they might be able to sell all their stocks today, wait things out, and then “buy back in when the election is over and things are better”. 

Unfortunately, this is Curly-from-The-3-Stooges flawed logic. If you happen to remember the TV show the 3 Stooges……..There’s an episode where Moe, Larry, and Curly are all in a row boat, and it springs a leak. So Curly gets this brilliant idea to drill a second hole in the boat so the water from the first hole can run out of the boat. 

The reality is a client who sells tends to never ever go back to a properly diversified portfolio. Ever. They are almost certainly trading their family’s long-term financial well-being for short-term emotional relief. 

“If I sell all my stocks now and then stocks go lower, I will just buy ‘em back lower.” No, you probably won’t. If that happens, you will almost certainly be even more fearful and stay paralyzed, because things will still feel bad. 

Or……“When things feel better, I will buy ‘em back then.” No, you most likely won’t. By that point, stocks will probably be up so much higher than where you sold that you will think “No way am I buying ‘em back here. They are up so much, and what if they go down after I buy them back?!?” This is the exact agony facing the investors who dumped their stocks back in March during the worst of the COVID-19 selloff.

If you are feeling panic-stricken, and having me sell a smaller portion of your stocks will enable you to clear your head, then just talk with me about doing so.

And if someone you care about needs help with their financial planning or portfolio management, have them contact me. I will help them.

Have a great rest of the week.

Rick Wagner
Senior Vice President, Wealth Management

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