Everyone wants impressive investment returns.
Who doesn’t?
As financial advisors, we want it too for our clients.
But there is something we want more for our clients than that.
We want the kind of return that matches the kind of risk a client can handle.
The truth is some people cannot handle high returns because they cannot handle the volatility associated with that.
If your portfolio can go up 20% in a year, it can go down by the same or more.
That’s the way this works.
Financial advisors are not investment forecasters. At least they shouldn’t be.
One of their primary jobs is to help manage investor behavior.
The market’s direction is not ultimately within the financial advisor’s control.
For example, at the end of last month, the S&P 500 was up about 12% on the year, having suffered a setback of 9% during the year. We haven’t experienced the average intra-year drop of about 14%.1
I’m not saying we will—but if we did, that would be entirely normal.
It may not be enjoyable, but it shouldn’t be surprising.
Don’t let AI recommendations, financial media drama, and the current top performing investment dictate your decisions. Invest according to a plan and what you can actually handle. If you can’t handle volatility, you can’t handle the stock market. Risk and reward always go together.
Do you know your risk tolerance? Or better yet, do you know whether your portfolio truly fits it? What about your family and friends?
Start with a risk assessment.
Here is a tool you can use.
If you or the people you love need help, reach out to us.
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Source:
1. JPMorgan Guide to the Markets, August 31, 2026. Accessed online.