How to respond when risk tolerance is tested

   Your comfort with risk is a key factor in your investment strategy. 
   But once you experience the ups and downs of the market, your risk tolerance could be tested. 
   For example, if you get extremely upset over the results on your investment statement when the financial markets drop, you might decide to invest more cautiously – and maybe that’s the right move for you. 
   However, such a move could also limit your upside potential. 
   To help keep your focus on your long-term goals, consider these steps: 
   First, look past the immediate event of the market drop. 
   These drops are typically followed by rallies, though there are no guarantees. 
   Next, realize the performance of any specific market index, such as the S&P 500, won’t completely track with your portfolio, which should contain a mix of investments not measured by any one benchmark. 
   Finally, keep your emotions out of your investment choices – overreacting to negative or positive news about the financial markets can lead to making poor choices. 
   Understand your risk tolerance – but do what you can to stick with an appropriate long-term strategy. 
   This article was written by Edward Jones for use by your local Edward Jones Financial Advisor John Dickerson. Member SIPC.   

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