As the U.S. and Israel-Iran war unfolds, markets are reacting, and many investors are asking what it means for their money.<\/p>\n
Learn More: 3 Safest Investments To Hold In The Current Trump Economy<\/a><\/p>\n Check Out: How Middle-Class Earners Are Quietly Becoming Millionaires \u2014 and How You Can, Too<\/a><\/p>\n GOBankingRates spoke with Christopher Stroup, a financial planner and CEO of Silicon Beach Financial<\/a>, about how disciplined rebalancing<\/a> could work amid the conflict.<\/p>\n Also see three ways the conflict in Iran is impacting your retirement investments right now<\/a>.<\/p>\n Energy prices spiked while travel stocks and regional assets recently took a hit, per Reuters<\/a>, as markets are bracing for the possibility of military strikes lasting at least a month or more.<\/p>\n That can raise a simple concern for investors: Is this the start of bigger losses? Stroup said volatility<\/a> alone is not a reason to overhaul a portfolio. Instead, he looks at whether market moves have changed the balance of investments inside it.<\/p>\n \u201cI don\u2019t rebalance because of headlines,\u201d he said. \u201cI rebalance when allocations drift materially from targets, typically 5% or more, or when volatility meaningfully alters the portfolio\u2019s risk profile.\u201d<\/p>\n Stroup advised discipline, saying, \u201cA geopolitical shock is noise; allocation drift is data. Discipline protects you from emotional overcorrection.\u201d<\/p>\n Be Aware: Mark Cuban Warns 4 Key Industries Could Crumble in the Next Recession<\/a><\/p>\n Geopolitical conflict often affects industries differently. Energy stocks, for example, can rally during periods of instability, while broader equities may pull back.<\/p>\n When one sector grows much faster than the rest, it can take up a larger share of a portfolio than planned. Stroup said the goal is not to chase momentum but to restore balance.<\/p>\n \u201cIf energy rallies and grows beyond its intended weight, we trim it back to target and redeploy into underweight areas, often broad equities or fixed income,\u201d he said. \u201cThat forces you to systematically \u2018sell high and buy lower\u2019 without guessing the next move. Diversification only works if you maintain it.\u201d<\/p>\n The result is a portfolio that stays balanced without turning into a geopolitical bet.<\/p>\n Bonds can also move during periods of conflict, especially as investors look for safer places to park money<\/a>.<\/p>\n Stroup said the focus right now is balance. \u201cWe\u2019re balancing stability and flexibility,\u201d he said. \u201cShort- to intermediate-duration bonds help manage inflation and rate risk, while still providing ballast during equity volatility.\u201d<\/p>\n However, investors may want to be aware of the duration. \u201cI\u2019m cautious about extending the duration too aggressively. Bonds should dampen risk, not introduce a new one tied to interest rate speculation,\u201d Stroup said.<\/p>\n For investors nearing retirement, market swings can carry more weight. A downturn matters more when withdrawals are approaching.<\/p>\n Stroup said volatility reinforces the need for a cash buffer and a clear withdrawal plan<\/a>.<\/p>\n \u201cFor pre-retirees, volatility reinforces the importance of a 12-to-24-month cash buffer and a clear withdrawal strategy,\u201d he said. \u201cIf markets pull back, we draw from cash or bonds rather than selling equities at depressed prices. Sequence risk matters more than headlines.\u201d<\/p>\n Having short-term expenses covered can help protect long-term investments during periods of instability.<\/p>\n Markets may rise or fall during war, but reacting to headlines can do more harm than good. The goal is to stay disciplined and keep investments balanced over time.<\/p>\n Editor\u2019s note: GOBankingRates is nonpartisan and strives to cover all aspects of the economy objectively and present balanced reports on politically focused finance stories. You can find more coverage of this topic on GOBankingRates.com<\/a>.<\/p>\n This article is for informational purposes only and does not constitute financial advice. Investing involves risk, including the possible loss of principal. Always consider your individual circumstances and consult with a qualified financial advisor before making investment decisions.<\/p>\n More From GOBankingRates<\/p>\n This article originally appeared on GOBankingRates.com<\/a>: I\u2019m a Financial Planner: Here\u2019s How To Rebalance Your Investments Amid the Iran Conflict<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"As the U.S. and Israel-Iran war unfolds, markets are reacting, and many investors are asking what it means…\n","protected":false},"author":2,"featured_media":520124,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[14],"tags":[64,63,99,30640,60635,186,110594,7929,184,185,69293,259588,19185],"class_list":{"0":"post-520123","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-personal-finance","8":"tag-au","9":"tag-australia","10":"tag-business","11":"tag-christopher-stroup","12":"tag-energy-prices","13":"tag-finance","14":"tag-financial-planner","15":"tag-investors","16":"tag-personal-finance","17":"tag-personalfinance","18":"tag-retirement-investments","19":"tag-silicon-beach-financial","20":"tag-volatility"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/520123","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=520123"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/520123\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/520124"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=520123"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=520123"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=520123"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}