The Key When Stock Markets Growl

HARRISBURG, Pa., Aug. 8, 2011 /PRNewswire/ -- Big market swings, blaring economic headlines and non-stop investment advice from numerous on-air and online personalities.  Global financial market conditions have been changing rapidly in the past several days and will likely continue to do so.  

Investors may suddenly have an increased number of questions in regard to their money, investments and retirement plans after all of this financial activity.  The Pennsylvania Securities Commission (PSC) reminds all investors that it may be beneficial to step back, remain focused on long term financial goals and avoid making rash investment decisions based on financial headlines.

"When investors pull money out of stocks and investments in fast dropping markets, they lock in losses and do not give the market a chance to recover," according to PSC Commissioner Thomas Michlovic.  "Traditionally, markets bottom out and then recover."

"You really need to focus on your long term financial and retirement goals," PSC Chairman Robert Lam added.  "You do not necessarily want to make a big change to your investment portfolio out of fear.  Negative headlines can sometimes turn in the opposite direction to more stable or even positive news within a few days or weeks."

The PSC's Investor Education Section offers investors a number of resources to help better understand and evaluate financial goals, retirement plans and the normal ups and downs of investing which can be accessed through the PSC's website at www.psc.state.pa.us by clicking on the "Investor Education" link.

Investors without Internet access can call toll free within Pennsylvania at 1-800-600-0007, or 717-787-8062 from any location, to request consumer information pertaining to the changing financial headlines.

"The big key here is to learn some investing basics -- not try to become an investment wizard," PSC Commissioner Steven Irwin added.  "Ultimately risk is a normal part of investing and you want to understand where your personal investment risk tolerance lies."

Irwin went on to add that investors can specifically learn how risk does factor into investing by exploring the resources of the PSC's Investor Education Section.  He mentioned that everyone has a different risk tolerance level when it comes to investing which often corresponds with age.  

"Typically someone in their 20s and 30s can have a much larger exposure to stocks and securities in their investment portfolio," Irwin referenced in regard to information on the PSC website.  "Investors in this age group have plenty of time to make up for market losses before retirement approaches and they are actually able to take advantage of acquiring securities at a lower cost in a downturn."  

Contributing just a small amount towards an investment or retirement plan regularly can potentially pay off handsomely in later years.  Irwin further added that investors in their 50s and 60s may want to consider a much lower exposure to stocks in their portfolio as they have a shorter time horizon until retirement.

Investors should be looking to meet with investment professionals during this fluctuating time period.  The PSC always encourages everyone to first contact the PSC to confirm the professional is appropriately licensed or registered with the PSC.  More information on this verification process is also available on the PSC website.

SOURCE Pennsylvania Securities Commission