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Craig Lundquist, MBA, ChFC®, CRPC®
VP of Wealth Management
651-773-2757
Kristin Becker
Senior Administrative Assistant
651-773-2821
Jozsef Hegedus, MBA
Associate Financial Advisor
651-773-2867
Ideal Wealth Advisors
Located at Ideal Credit Union
8499 Tamarack Road
Woodbury, MN 55125
CRPC conferred by College for Financial Planning
September/October 2025
Investing in a Volatile Market
Investing in a volatile market requires careful strategy, discipline, and a long-term perspective. By understanding the causes of volatility, using effective risk management techniques, and avoiding common pitfalls, you can navigate turbulent markets and work toward achieving your financial goals. While volatility presents challenges, it also offers opportunities for those prepared to manage it wisely.
Understanding Market Volatility
Volatility can stem from various sources, such as economic indicators, geopolitical tensions, changes in interest rates, and unexpected global events. Recognizing these factors can help you anticipate potential market movements instead of merely reacting in crisis mode. However, it's crucial to remember that periods of volatility often result in market inefficiencies, creating unique opportunities for those willing to remain patient.Crafting a Sound Strategy
Some investment tools that you and your trusted advisor can use to develop a strategy for volatile markets include:Diversification.* By spreading investments across different asset classes—such as equities, fixed income, real estate, and alternative investments—you can mitigate the impact of market downturns on your portfolio. Each asset class reacts differently to market shifts, smoothing out returns over time.
Asset Allocation.** In alignment with a longterm strategy, maintaining a disciplined asset allocation tailored to your risk tolerance and financial goals is critical. Regularly reviewing and rebalancing your portfolio with your advisor can ensure you stay aligned with your investment objectives while capitalizing on market fluctuations.
Emotional Resilience. Volatile markets can evoke emotional responses, leading to hasty decisions. Setting predetermined guidelines for buying and selling can help you stick to your strategy during turbulent times.
Effective Risk Management Techniques
Your trusted advisor may also recommend riskmanagement techniques, including:Investing in Quality Assets. Focusing on high-quality investments—solid fundamentals, consistent cash flow, and resilient business models—can offer stability during turbulent periods. These values are less likely to be affected by market fluctuations, allowing them to provide a reliable return even in challenging conditions.
Stop-Loss Orders. Stop-loss orders may safeguard your investments by automatically selling securities when they reach a specific price. This method protects against severe losses, allowing you to exit positions before they decline further.
Options and Hedging Strategies. Employing options may provide an effective means of hedging against market downturns. Strategies such as protective puts can help shield your portfolio during times of high volatility while preserving your investment in the long term.
Avoiding Common Pitfalls
In volatile markets, high-net-worth investors may succumb to common traps, such as overreacting to short-term market movements or chasing fleeting trends. Commitment to a well-defined investment plan and focusing on long-term objectives is paramount. Additionally, seeking guidance from financial professionals with expertise in navigating volatility can provide strategic insights and mitigate risks.*Diversification cannot eliminate the risk of investment losses. Past performance won't guarantee future results, and investing in stocks or mutual funds can result in a loss of principal.
**Asset allocation won't guarantee a profit or ensure against a loss but may help reduce volatility in your portfolio.
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Securities and advisory services are offered through LPL Financial (LPL), a registered investment advisor and broker-dealer (member FINRA/SIPC). Insurance products are offered through LPL or its licensed affiliates. Ideal Credit Union and Ideal Wealth Advisors are not registered as a broker/dealer or investment advisor. Registered representatives of LPL offer products and services using Ideal Wealth Advisors, and may also be employees of Ideal Credit Union. These products and services are being offered through LPL or its affiliates, which are separate entities from and not affiliates of Ideal Credit Union or Ideal Wealth Advisors. Securities and insurance offered through LPL or its affiliates are:
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