The worst thing young clients can do is panic and stop investing: Wealthsimple CEO
Amid economic volatility, young investors should continue to be disciplined by sticking to their investment plan and remaining in the market, according to the co-founder and chief executive officer of Wealthsimple Inc.
The current economic situation marks the first major drawdown that many new investors have experienced, Mike Katchen, said in an interview with BNN Bloomberg Wednesday.
“The worst thing young clients can do right now is panic and stop investing. These are the times when it's so important to help people really remain focused on what counts for delivering long-term investment outcomes,” he said.
Millions of individuals have begun investing for the first time over the last few years, according to Katchen, driven by an interest in meme stocks in many instances, as well as an “overall demand for investing.”
Despite the current market volatility, Katchen said he has been “quite pleased” regarding the response from Wealthsimple clients.
“People are generally not pulling money out of the market. They're staying disciplined about their investment strategy and plan. Though we are definitely seeing a bias for cash and safer investments, more so than the last number of years,” he said.
Despite a widespread instinct to sit on the sidelines and watch the market from a distance, investors should stick to their plan, Katchen said.
“The reality is, the smart thing to do as an investor is to just keep investing, to stay disciplined on a plan no matter what the market is telling you and what the market is doing,” he said.