Breaking news of the world’s conflicts is available at every turn – on the television, in the papers, on the Internet. Every 15 minutes we can access the latest updates. “Explosions rock Baghdad.” “North Korea officially withdraws from nuclear arms treaty.” “U.S. forces fired upon in Afghanistan.” By the time you read this, undoubtedly more breaking news will have surfaced.
Every report seems to produce volatility in the financial markets, with stock prices reflecting the ebb and flow of the military and political battles. While there are usually multiple factors that affect market movement, the financial press will often assign one explanation for the change, especially in times of geopolitical turmoil. “Stocks slide amid war fears.” “Markets tumble with added uncertainty.” “Stocks rally with successful campaign.”
It’s easy to be swept away by the reports, and it’s reasonable to worry about the impact the events will have on your investments. But successful investors don’t allow this noise to distract them from their plan.