What to do when the stock market tanks

Investing has never been easy. In order to build wealth, investors on average have been investing for 29 years to hit the 7-digit mark. Many buy stocks in times like these when there is a recession, but things are currently unstable with COVID-19 in the picture. The stock market has been going up and down as investors aren’t sure how COVID-19 will affect the stock market.

The TPS stock funds reached new heights during the first half of 2021. This was due to the decline in COVID-19 cases, increased vaccination, and re-openings, etc. This caused a surge in the economy, and for CSI fund to reach the recorded high as mentioned in the end of June.


YTD & 1 year are the total return for that period

1,3,5,10,15 returns are Compound Annual Returns

Investments cannot be made directly into an index. Future performance is never predictable even if you try to base it on past performance. All investments involve various risks including loss of capital and volatility. Returns are rounded to tenths of a perfect. Returns include reinvestment of all income and bond funds do not account for taxes.

When it comes to the market outlook there are different factors to consider such as:

  • COVID-19
  • Change in Federal Reserve monetary policy (QE)
  • Reduction in government stimulus (fiscal policy)
  • Wars, revolutions, terrorist attacks, climate disasters, etc.

All these factors are what ends up leading to market forecast declines in the future. However, forecasts are not as reliable since we don’t know for sure at what time they may occur. It is inevitable that the market will decline at some point or another but knowing when and how long is still unknown.

Know what the stock market is trading and how often. If the percentage drops to 7% on that same day, it should send read flags to a possible crash. The market usually is between -1%-1%.

Having different investments is key to reducing investment risk. Diversifying in the types of stocks you invest in will cause minimal loss when the stock market crashes. There will be a loss in money, but it will not be as significant if you had invested in one area solely.

When stock prices start to lower that is the best opportunity to buy stock you have been eying for a while. Be cautious when choosing stocks and choose ones that have the best potential in the long run. When the dip occurs that is the best chance to swoop in.

When prices start to lower don’t get scared. Remember the benefits of having the stock and that not every day is a good day. There are times in which prices lower but having a cool and calm headspace is the best chance from making a silly mistake.

By: Jennifer Fernandez