Column: Wealth in our Woods — don’t give up the ship

By Kyle Green for the Sherwood Sun

SHERWOOD, Ore. — Sometimes it feels like this country is going to implode on itself. It doesn’t really matter which side of the political spectrum you land on; it’s a disconcerting time. Every other day there’s some headline that sends everyone into a tailspin. We are constantly being reminded that we are living in unprecedented times. These abrupt and unconventional changes can spark fear, anxiety, and sometimes full-on panic. Those emotions are precisely what erode investor confidence and fuel uncertainty in financial markets. For financial markets, uncertainty is not unusual; it’s a constant. It’s not a signal to act upon; it’s an eventuality we prepare for.

Knee-jerk responses to troubling news, like selling off positions or rushing into whatever investment feels safe in the moment, are understandable – incorrect, but understandable. Breaking headlines report events that have already been reflected in market prices. Selling in reaction to news of declining markets often means locking in those losses after the damage has been done.

On the other side of the cycle, market recoveries tend to begin well before the economy feels better or headlines turn positive. Investors who wait for clarity often miss the early stages of recovery and, in doing so, compound their losses. You are increasing the likelihood of taking losses on both sides of the transaction. This is why trying to time the market is not an effective strategy.

There are only a handful of truly crucial investing days in any given year. Research consistently shows that missing even a small number of the market’s best days can dramatically reduce long-term returns. The challenge for short-term investors timing the market is that many of those best days occur shortly after the worst ones; just when they are sitting on the sidelines, waiting for things to feel safe again.

This is why investors should avoid comfort-seeking, short-term behavior and instead adopt a slow, methodical approach based on long-term investing. While pullbacks and corrections are common, the market has historically spent far more time moving upward than downward. Rather than trying to miss the worst days of the year, position yourself to endure them and take advantage of the best days. As the old saying goes, “it’s not about timing the market, it’s about time in the market.”

Long-term discipline, combined with a properly diversified portfolio, is what carries investors through market downturns. Diversification distributes your investment dollars across a multitude of industries, company sizes, and market types. It’s not a way to predict the future; it’s a way to prepare for it. Volatility is normal, but prolonged decline has been comparatively rare. Diversification will help you make it through those declines. Short-term volatility is the price investors pay for long-term growth, and trying to avoid volatility often means avoiding returns, which defeats the purpose of investing. Remember, the goal is not to avoid downturns, but to survive them.

Here in Sherwood, we’re used to thinking long term, about our families, our schools, and the kind of community we want to build. Investing should be approached the same way. Markets will rise and fall, headlines will come and go, but a disciplined, long-term plan gives you something to hold onto when uncertainty rears its ugly head. Long-term investing isn’t blind optimism; it’s about faith in adaptation.

Things are strange now; we are, after all, living in unprecedented times. Staying invested isn’t about ignoring what’s happening in the world; it’s about maintaining perspective, thoughtful preparation, and remembering that progress is rarely smooth, but it is persistent.