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There’s an unspoken understanding when we step aboard an airplane. We pay a fare to travel from one location to another, trust that the pilot and the crew will do their jobs well, and walk away satisfied that we flew the friendly skies and got to our destination.

In many ways, the experience we have while eating those complimentary pretzels is similar to the one we have as investors. We invest our financial assets, work with a trusted financial professional to help grow our portfolios, and hopefully reach our financial goals. 

Unfortunately, you don’t have to strap yourself into an aircraft seat to experience turbulence.   


Highs and Lows

Investing in equities has always required riding out the ups and downs. The 24-hour cable-news cycle repeatedly declares heightened volatility to be the “new reality.” 

But in reality, volatility happens more frequently than many realize. In the last two decades, for example, the S&P 500 Index1 has experienced intra-year declines in every calendar year—even when it ultimately produced positive year-end returns (FIGURE 1). Not every year managed to recover and notch a positive ending, but no year was immune to a period of negative performance.

This seemingly unpredictable market cycle of gains and losses has investors asking, “How can we prepare for what comes next week, next month, or next year?” Plain and simple: develop a solid financial plan, stick with it, and resist the urge to panic. 

Intra-Year Dips in the S&P 500 Index Happen Frequently

Intra-Year Dips in the S-and-P500 Index Happen Frequently

Past performance does not guarantee future results. Indices are unmanaged and not available for direct reinvestment. Assumes reinvestment of capital gains and dividends and no taxes. Drawdown refers to the largest market drop from peak to trough during the calendar year. Sources: Morningstar and Hartford Funds, 1/24.

Now Boarding…

Just as those boarding a flight need to take heed and obey the rules and regulations of the flight, so, too, do investors when it comes to adhering to a financial plan. Haven’t checked your plan out in a while? Maybe the time is right to review it with a financial professional. Together, you can reassess your investment situation and risk tolerance, starting with these steps:

  1. Consider a financial plan that features a diverse mix of equities and fixed-income investments. This can help diversify your risk; although not risk-free, the use of fixed-income investments can help reduce the impact when equities fall.
  2. Consider setting up a rebalancing strategy to help keep you on the right track. Pick a defined time frame with your professional to adjust your holdings. Having a rebalancing strategy can help safeguard you from being exposed to too much risk. It’ll also help you adhere to your overall plan whenever volatility strikes. 


Talk to your financial professional about preparing your portfolio for volatility.


1 S&P 500 Index is a market capitalization-weighted price index composed of 500 widely held common stocks.

Important Risks: Investing involves risk, including the possible loss of principal. • Fixed-income securities are subject to credit risk, liquidity risk, call risk, and interest-rate risk. As interest rates rise, bond prices generally fall. • Diversification does not ensure a profit or protect against a loss in a declining market.

This information should not be considered investment advice or a recommendation to buy/sell any security. In addition, it does not take into account the specific investment objectives, tax and financial condition of any specific person. This information has been prepared from sources believed reliable but the accuracy and completeness of the information cannot be guaranteed. This material and/or its contents are current at the time of writing and are subject to change without notice.

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The material on this site is for informational and educational purposes only. The material should not be considered tax or legal advice and is not to be relied on as a forecast. The material is also not a recommendation or advice regarding any particular security, strategy or product. Hartford Funds does not represent that any products or strategies discussed are appropriate for any particular investor so investors should seek their own professional advice before investing. Hartford Funds does not serve as a fiduciary. Content is current as of the publication date or date indicated, and may be superseded by subsequent market and economic conditions.

Investing involves risk, including the possible loss of principal. Investors should carefully consider a fund's investment objectives, risks, charges and expenses. This and other important information is contained in the mutual fund, or ETF summary prospectus and/or prospectus, which can be obtained from a financial professional and should be read carefully before investing.

Mutual funds are distributed by Hartford Funds Distributors, LLC (HFD), Member FINRA|SIPC. ETFs are distributed by ALPS Distributors, Inc. (ALPS). Advisory services may be provided by Hartford Funds Management Company, LLC (HFMC) or its wholly owned subsidiary, Lattice Strategies LLC (Lattice). Certain funds are sub-advised by Wellington Management Company LLP and/or Schroder Investment Management North America Inc (SIMNA). Schroder Investment Management North America Ltd. (SIMNA Ltd) serves as a secondary sub-adviser to certain funds. HFMC, Lattice, Wellington Management, SIMNA, and SIMNA Ltd. are all SEC registered investment advisers. Hartford Funds refers to HFD, Lattice, and HFMC, which are not affiliated with any sub-adviser or ALPS. The funds and other products referred to on this Site may be offered and sold only to persons in the United States and its territories.

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