With the wild swings the stock market has taken in recent months, financial advisers say it can sometimes feel as if investments are on a roller coaster.
On Tuesday, the Dow Jones Industrial Average soared 416 points to close above the 12,000 mark. Still, in October, the Dow was over 14,000.
Chattanooga-area financial professionals said they tell their clients to think long term about investments, and to look at the market as if its stocks were on sale.
Ward Petty, vice president of Wachovia Securities in Chattanooga, said many people are hesitant to take advantage of lows because they fear missing out on a better deal.
“They think it may go down another 20 percent,” he said. “When it comes to the stock market, people do not treat it the same way, I don’t know why.”
Q: What should people do with their money when the stock market is so volatile?
* Name: Ward Petty
* Age: 45
* Occupation: Branch manager/vice president Wachovia Securities
“I think they definitely ought to keep a little bit of dry powder on the sidelines; just always keep a little bit of cash in reserve.
“Buy strategically, that’s what I say. Buy on the dips, when the market goes down. Right now (before Tuesday), we’re back under 12,000, the people I am talking with, if they have some (money in reserve), I am telling them, let’s go ahead and deploy some of it.
“I don’t know that this is the last time it will dip down below 12,000, but we know if the market was at a high in October of 14,000, then we know, we’ve seen a pull back of roughly 20 percent.
“Most of the corrections, if you are looking at the technical definition of a correction — it is a pullback in the market of between 15 and 20 percent ... well, that’s what we’ve got, that’s where we are.”
* Name: Chuck Corey
* Age: 56
* Occupation: Vice president of investments, Raymond James & Associates Inc.
“We advise our clients to take a long-term view of their investments. Also you can use the volatility to your advantage by investing in securities you may have been considering at attractive prices.”
* Name: Jim Ross
* Age: 62
* Occupation: Financial adviser, Edward Jones Investments
“We tell our clients, if they stay the course, they will be well positioned when the market reestablishes itself at higher values.”
Compiled by Amy O. Williams
