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Clients want to know: Why the sudden stock market drop?

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Bruce Sansom

It is apparent the algorithmic trading turned a minor adjustment into 3 days of record volatility. I think the Algo traders should be shut down. It is front-running pure and simple. They claim they improve liquidity. If so, why a thousand point decline in seconds? That’s providing liquidity? They are skimming billions from legitimate investors and the Regulators are spectating.

Wednesday, Feb 7, 2018 at 7:20 pm Reply

Ami Maishlish

Market fluctuations, including downturns (that are often labeled with the ‘politically correct’ term, “corrections”)are a normal phenomenon. These present buying opportunities but also can be a cause of panic (particularly for those who are prone to be riled by “media experts”, incl. those borrowed from the Sports Desk or the Political Desk, to write fill for the white space between ads.)

Unless the downturns are realized and materialized by a panic reflex, the losses are merely “paper losses”

As the saying goes (amended) “If you can’t stand the heat, don’t enter the kitchen”. In other words, stay within your risk tolerance and be mindful of your financial picture as a whole. If your savings are in your RRSP, build a hedge that includes life insurance to cover for a potential deemed disposition which may deliver a “double whammy” of death-income-taxation at marginal rates plus actual disposition at a low point to pay the taxes and other estate obligations. Regardless,don’t panic.

Tuesday, Feb 6, 2018 at 11:59 am Reply