Financial advisors polled by CNBC said investors should hold steady after Thursday's market downturn, rather than make sudden changes to their portfolios. In a flash poll of 38 firms from CNBC's Financial Advisor 100 and Financial Advisor Council, more than three-quarters of respondents recommended that investors check their allocation against their goals or stay the course.
The Nasdaq Composite fell 5.5% on Thursday, closing more than 10% below its recent high and entering what Wall Street calls a correction. The S&P 500 lost 4.4%, and the Dow fell 3.4%, or more than 1,800 points. The selloff followed concerns about a potential data center construction slowdown.
Advisors offered a consistent message: review whether your portfolio still matches your goals, but do not let a sudden market move drive the decision. Andy Pratt, director of investment strategy at Burney Wealth Management in Reston, Virginia, noted that investors who contribute regularly to a 401(k) benefit from buying at lower prices during downturns. "You're able to dollar-cost average in," Pratt said. "So when the market does sell off, you're entering at a much better spot."
John Mullen, managing director, president and CEO of Parsons Capital Management in Providence, Rhode Island, said, "Stay the course with an eye on buying."
If panic sets in, that may signal a need to reassess whether your investments fit your goals and risk tolerance, advisors said. Carolyn McClanahan, a certified financial planner and founder of Life Planning Partners in Jacksonville, Florida, tells clients to stick to an investment policy that reflects their needs and "tune out the rest of the noise."
Dan Moisand, a CFP and financial advisor at Moisand Fitzgerald Tamayo in Orlando, Florida, said resilience matters more than trying to time each market swing. "Being resilient has proven to be more profitable than trying to be nimble," he said.