2021 rally brings opportunity to reduce portfolio risk in 2022
BNN Bloomberg
As the glow of a stellar 2021 for equity markets fades, retirement investors are faced with the stark reality that the world remains fraught with risk.
As the glow of a stellar 2021 for equity markets fades, retirement investors are faced with the stark reality that the world remains fraught with risk.
The COVID-19 pandemic is far from resolved, and the promise of interest rate hikes by central banks to cool inflation brings another layer of uncertainty as access to cheap cash dwindles.
It’s easy to get lulled into a false sense that markets will continue to steam ahead but logic tells us corporate earnings can not continue to grow at their current pace - and it’s corporate earnings that drive equity markets.
If your retirement plan targets average rates of return over the long term, outsized gains from 2021 could provide a boost to lock in gains and lower overall portfolio risk.
Risk management is a complicated task and a qualified investment adviser could help you find your comfort zone for 2022 without sacrificing returns too much.
Here are some areas to explore:
