Investors hardly understand the need to hire a financial advisor unless they face major market volatility. Not everyone is an investment expert. If you are a beginner or even a mid-term investor, you might feel anxious during market downturns and make wrong decisions at times. By partnering with a good stock advisory company, you can minimize risks and avoid making wrong decisions under emotional influence.
If you are still not convinced to hire a financial advisor for mutual funds or other investment assets, we have listed some significant reasons to consider it below. Before moving to that, let’s discuss whether you should be worried about volatility in mutual funds or not:
Should You Be Bothered About Volatility in Mutual Funds
Mutual funds are considered comparatively safer investment options than other assets, such as individual stocks. When investing in mutual funds, you should not be bothered by daily fluctuations. If you are able to achieve your long-term financial goals, that’s completely fine.
It’s just like those multiple bumps that you face during a long drive. But in the end, what matters is the average speed at which you drove the car to reach your destination. Your speed must have turned zero many times in between, but the car picks up the speed again, and you ultimately reach where you want to be. This is exactly what happens with mutual funds.
There will be ups and downs, but if the average seems to be fine, you don’t have to worry. But we cannot deny the fact that market volatility causes stress among investors. You may feel like selling all your assets and making wrong investment decisions under emotional influence. This is where having a financial advisor for mutual funds can be of great help.
Role of Financial Advisors in Minimizing Risks During Market Volatility
A stock market advisory can help you at every stage of your investment process, be it choosing the right investment assets, selling them, diversifying your portfolio, or handling market volatility. By hiring a trusted SEBI-registered financial advisor, you can make your investing journey smoother and stress-free. Here’s how a mutual fund advisory services company can help you minimize risks in a volatile market:
1. Understand How To Handle Market Drops
A sudden market drop can make you feel stressed. This is a situation where investors feel like they don’t know what to do, especially beginners. In this situation, your financial advisor can reassure you and show you the right path.
Based on your short-term and long-term financial goals, your stock market advisor will help you decide whether you should make any adjustments or stay invested the same way. During volatility, if you realize that you are not very comfortable with taking risks, you can share the same with your advisor, and they will help you make investment decisions accordingly in the future.
2. Learn How to Turn Volatility Into Opportunity
Instead of getting worried by market fluctuations, you should try to stay invested during market volatility. It is in fact a great time to identify new investment options. Selling your assets when the market is down can result in losses, and recovering these losses can be difficult.
But deciding where to stay invested and what new assets to invest in can be challenging. This is where a financial advisor can help you. They will help you choose new stocks at lower prices that align with your risk-taking capability.
3. Manage Your Portfolio
Looking at your portfolio when the entire market is down is nothing less than a nightmare. However, as mentioned earlier, you should not worry a lot about mutual funds. But what is there are other assets as well, each down by a big percentage? It’s common to feel anxious in such a situation.
Having a financial advisor here can be very effective for portfolio management. They will help you find ways to adjust so that you can minimize risks and still achieve your long-term financial goals.
4. Protect Your Savings
If you are someone who is already relying on retirement funds for everyday living expenses, market volatility can badly impact your life. Your financial advisor can help you manage your savings and make necessary adjustments to your portfolio to ensure that there is a potential income stream even when the market is down.
5. Prepare for Upcoming Downturns
Having a financial advisor backing you can be a big relief in itself in times of market volatility. They not only help you manage your portfolio during volatile markets, but also prepare you for possible future downturns. Stock market and mutual fund investments are subject to fluctuations. All you need is a wise financial advisor who can understand your long-term goals and help you stay aligned with the same.
Hire Sana Securities as Your Financial Advisor for Mutual Funds
Sana Securities is a SEBI-registered financial advisory that is trusted by thousands of investors worldwide. Rajat Sharma, who is the CEO of Sana Securities, is among the best stock advisors in India and has been working in this field since 2011. With over a decade of experience and a wide customer base, our firm has become one of the top financial advisory firms in India. Whether you are looking for a financial advisor for mutual funds or a stock market advisory, we have the right solution for every need. For any further information, get in touch with us now!
FAQs
1. What strategies do financial advisors use to manage mutual fund investments during market volatility?
Ans. Some strategies used by financial advisors during market volatility include:
- Identify new market opportunities while staying invested in old assets
- Portfolio diversification
- Re-assessing risk tolerance and making necessary adjustments
2. Can a financial advisor adjust my mutual fund portfolio to reduce risk exposure?
Ans. Yes, when required, a financial advisor can help you adjust your mutual fund portfolio to minimize risks and achieve your long-term financial goals.
3. How do financial advisors help prevent emotional decision-making during market downturns?
Ans. Financial advisors can reassure you that you will recover losses once the market goes up and will guide you through the right strategy to manage your portfolio rather than making emotional decisions that may result in losses.
4. How do financial advisors use diversification to reduce investment risk?
Ans. Financial advisors help you diversify your portfolio by including different investment assets from different industries into it to reduce risks.
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