While traders have been spooked by coronavirus mania, investors shouldn't let the headlines make their decisions. Don't panic and stay the course.
Michael Smith at Houston's STA Wealth Management tells his clients to prepare for market downfalls.
"We start with a comprehensive financial plan, this is something we discuss with them prior to, we help them understand the risk so that when something like this does happen they're prepared for it."
Smith says, hopefully, last week was a worst-case scenario.
"Look at last week and look at all of your individual positions and ask yourself 'how far were they down?' Are you comfortable? Do you need to try something different?'"
Smith says the Fed's emergency rate cut Tuesday shouldn't alarm investors. He agrees with Omaha billionaire Warren Buffett's advice to not to make 401(K) decisions based on the headlines.
"I don't think it's alarming; I think it's well-needed. But keep in mind this is nothing more than a patch and the idea is to kind of put a stop-gap on the markets, which I think are causing a lot of the panic by individuals."
Experts point out the coronavirus outbreak's effect on the markets will be short-lived and don't let fear drive your decisions.