Stock market volatility: 6 things to consider when trading in today’s market

Whatever your level of investment, it’s really important to research all your options before making any financial decisions. In the current climate, you may have natural concerns. Which is why we’ve compiled our top 6 things to consider before trading.

Please remember that the value of investments and the income from them can fall as well as rise, and you may get back less than you invest. If you’re not sure about investing, seek financial advice. Tax treatment depends on individual circumstances and may be subject to change in the future.

1. Do I really need to take action now?

Fallen stock values and alarming news headlines could make you want to rush into investment decisions. It’s important to always take your time and calmly think through any financial decisions before you act on them.

Many investments have fallen in price recently but selling them off now may mean missing out on any potential increases in the future if markets recover.

2. What other options are available?

If you need to make cash available in the short-term, make sure you consider every option you have. Are there any alternatives you could draw from instead of realising losses from an investment?

Could you access any savings in the short-term? (keep some savings set aside if possible). Could you access one of the government support measures that have been put in place?

If you find that you do need to cash in your investment, if possible, only cash in the minimum you need. If you’re thinking about cashing in a larger investment, it’s worth seeking advice from a financial expert before going ahead.

3. What risks should I consider when thinking about current opportunities?

Investors often use dips in the market as an opportunity to invest while prices are low. If you are considering doing this, it is important to make sure that you have the right level of risk in your portfolio and that it contains a range of different assets.

If you have more money invested in one particular asset or sector it is more likely your portfolio will be more impacted by market movement. Remember that when selecting investments, past performance is not a reliable indicator of future performance.

Our Boost Your Skills articles have plenty of useful further reading on blending your assets and risk management. Seek independent financial advice if you’re unsure.

4. Could I change or adjust my regular contributions?

Now could be a good time to review regular investments you contribute to.

If you’re comfortable with the risk level of your investments, you may wish to continue your current level of contributions.

You may choose to reduce or stop your regular contributions, whilst researching any changes you wish to make in future. You may want to seek expert financial advice before making any changes.

5. If I act now, will this affect my tax relief?

It is good to understand what impact your investments have on tax relief. For example, by investing in pensions you have an added uplift in tax relief from the government on your contributions.

Keep in mind that ISAs don’t benefit from the same government uplift but holding your investments in an ISA means that any potential profit you make is free from UK tax, making your investment tax efficient.

Remember that tax treatment is dependent on your personal circumstances and may change in the future.

6. Am I making the most of the research tools available?

You can use our practical tools to monitor your investments and the current market situation. They can help you feel more in control of how your investments are performing.

Don’t forget you can visit Market News and read the latest independent market analysis for free.

Our Research Centre also has all the information you need on the performance and latest prices of your investments. When researching your investments, remember that past performance is not a reliable indicator of future performance.

Remember: if you’re in any financial difficulty MoneyHelper can offer free and impartial advice. You can contact them via their website at

You can also find advice specific to Covid-19 on our Coronavirus help page.

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