How to navigate the ups and downs

As Steve Daghlian, our Market Analyst, commented recently in the video ‘Market volatility and what it could mean for you’ the only thing we can control is our decisions. Trying to access the situation and making decisions with a cool head is key.

Some tips we have during this time are:

• Do your research: it doesn’t always pay to dive in headfirst. There are many methods of assessing and selecting shares, whether you’re looking for large caps or small caps, income or growth, or undertaking more complex analysis.
• Think about timing: Have you ever heard the saying that “time in the market is more important than timing the market”? It can be true. While timing is important, you should also remember that it can be very hard to predict the best time to buy shares or to pick the 'bottom of the market’ (the lowest price reached by a share, commodity, index or economic cycle in a given time period).
• Don’t put all your eggs in one basket: build a portfolio with multiple stocks from a range of sectors. Getting the right mix in a portfolio is about diversifying to help protect your investments from market volatility and reduces risk.
• Try to stick to what you know: you don’t need to get caught up in other people’s enthusiasm for a share, especially if it’s in a sector you know little about.
• Don’t forget to do your sums: only invest in what you can afford. The right time to invest should be when you have created a financial buffer for yourself with a savings strategy and are in control of your debt.

To assist with making investing decisions that are right for you, we have a number of resources available, including:

• Developing a trading strategy: It's important to have a strategy in mind when you trade in shares so that you're picking investments that best suit your financial goals. We outline what you should keep in mind when looking to develop your own personal strategy.
• Knowing when to sell: Selling shares can sometimes be harder than buying. Is it worth holding on a bit longer for more gains, or should you just cut your losses? Here's some guidance as to how you can objectively make a decision on what to do.
• How much of a risk are you willing to take? Buying shares comes with a number of risks and it’s important to understand and be comfortable with them before investing. The biggest risk of investing in shares is that you could lose some or all of your money.

If you are not sure where to start, would prefer less choice in your universe and would like to diversify, you can check out CommSec Pocket, a simple investing app we’ve created. You can start investing with as little as $50, and gradually build a portfolio over time. Choose from seven themed investment options and invest in something that suits you, like tech, sustainability leaders, or the biggest 200 companies on the Aussie market. We’ll help you along the way with bite-sized tips, videos, and articles to teach you all about the share market.

Don’t forget that we’re here to support you and your investing journey, wherever that may take you.