How Financial Advisers Guide Investors Through Volatility

Here's how financial advisers are protecting clients from what could be some serious chop in the market.
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Sure, President Trump said he'll delay more tariffs on Chinese goods beyond the March 1 deadline.

But one financial adviser is surprised there hasn't been much volatility in 2019, and isn't sure the VIX - the so-called fear index - will stay down in 2019. 

Here's how financial advisers guide retail clients through choppy waters:

"If you're on a ship and you're getting ready to sale into a storm, you don't want to wait until you're into the storm to start battening down the hatches, so to speak," said Shawn Cruz, trading strategy manager at TD Ameritrade. "What you want to do is when you're in calm waters, that's when you have the time, and you can be very thoughtful and deliberate about what you're doing." 

So what actions are there to take in these calm waters?

"Look at rebalancing," Cruz said. "When you do get some of these pronounced moves, both on the upside and downside, it can throw your sector allocation a little bit out of whack where you can maybe have underexposure to one sector and overexposure to another." 

Using put options, essentially insurance against long positions, is another move to make. 

See how some retail investors have rebalanced and hedged ahead of the March 1 trade deal deadline here