The enemy of long-term investment success is short-term thinking. Short-term thinking is caused, almost always, by the arrival of a downturn in the market. Concern, particularly with an inexperienced investor, can all too often turn to worry or even panic. A hasty decision often follows. Investors sell-off part of their portfolio at a loss, hide on the sidelines to wait out the storm until the market seems to be returning to normal, and only start investing again when they feel the coast is clear.

But market reversals are nothing new. And even quite dramatic falls are hardly rare, startling though they may seem. Markets, like life, have their ups and downs. The key is to keep calm, think rationally, check out historical market information, and seek the help of a financial planner.

Although these ups and downs can create fear among investors, a long-term view shows the impact on most kinds of investments is less dramatic than frequently expected. Historically, rises have typically followed quite quickly after even steep falls in the market and, accordingly, investments have tended to recover.

It is generally agreed that investors who maintain a long-term outlook for their investments have an advantage over those who do not. Successful, long-term investors understand that while the market will always experience periods of decline, history has shown that they tend to recover in the long run.

Talk to a TD Waterhouse Financial Planner if you have any other questions or concerns about your investments.

By Gillian Watt,TD Waterhouse Financial Planning
Gillian.Watt@td.com

For more information, or to receive a complimentary copy of the most recent TD Wealth Management Market Outlook newsletter, please contact me @ 613-548-4766 or email me at Gillian.Watt @td.com>