3 Steps to Help Advisors Thrive During Uncertain Markets

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The Greatest Asset: Mastering Your Practice with Thomas Droge 

At TIFIN Wealth, our “why” is solving for any challenge advisors may experience in their practices and creating solutions to help you grow your business. In our The Greatest Asset series, TIFIN’s Chief Mindfulness Officer Thomas Droge shares how advisors can implement strategies to maximize their impact and wellbeing in their businesses – and in their lives. In this post, Thomas shares three steps advisors can take to thrive within uncertain market environments. 

TIFIN Wealth: Even the most experienced investor will face uncertainty when there’s a tail event or extreme market uncertainty. Why do so many people face the unknown with fear? 

Thomas Droge: To understand the unknown, we first have to understand what the known is. 

Human beings learn by building models of the world around them, we take in sensory data and make a prediction of how the environment will respond. And then we test it. When the prediction works, we consider that information to be the known. All of this happens in real time within the confines of our unique perspective. What we call the unknown is really just a situation that doesn’t have a predictable model. To thrive in an unpredictable environment, we have to adapt. 

To illustrate this concept, consider the prism of our eyes, and our literal ability to see. An image focused by the human eye on the retina is inverted, from birth and this continues throughout life. Within a few weeks of birth, the brain assembles visual data into a useful picture of the world and recognizes this upside down as normal. So we go on to learn eye/hand coordination within what’s actually a flipped visual world. 

So when markets are tempestuous, our reaction is largely the same. We seek to find balance in a world that’s upside down, and fit new realities into the models we have built within our minds. 

TIFIN Wealth: So how does one take this fear and turn it into the ability to thrive within the unknown?

TD: The integrated systems within our minds work together to help navigate new realities. We take in new information, build a model, and test it. We shift a bit and learn from our missteps. This so-called adaptive unconscious has allowed humans to adapt and change, and has largely helped keep us alive as a species.

Take the example of being lost in a dark forest. At first, you feel around in the moonlight. As you walk around in a new environment, it could be terrifying as you lack points of identifiable information. There’s then a point where you start to feel more comfortable. You can use your senses to make out shapes, sounds, and smells. You look up and see the stars, and they’re glorious. 

Many investors thrive in choppy markets. Once you start to recognize the familiar, you can start to not only adapt, but learn and thrive. 

TIFIN Wealth: What are some action items advisors can take to embrace the unknown and make it work in their favor?

TD: There’s a model for dealing with uncertainty that I like to call the 3 As: Acknowledge, Accept & Adapt. Volatile, unpredictable markets are always going to happen, and there’s nothing any of us can really do about that. Tools fail, and you have to pivot. 

It takes great conviction to practice acceptance. People who survive the toughest events are the ones that are willing to let go of what isn’t working and open up to the possibilities of what could be, by seeing things as they are. The strong tree that bends in the wind does not compromise its integrity. It keeps its root and structure intact as it becomes flexible to adapt. It’s the same with business. The unknown can be a great incubator for innovation and growth. Skill is honed through adversity.

It’s the advisor’s job to accept any market as it is and see it as clearly as possible. You can authentically offer clients some stability and confidence only after you’ve been able to do that for yourself. Find the wisdom within the situation and share that with your clients. Nobody wants to get lost in the woods, but sometimes you have to, and by doing so, you can spare others. 

To go back to the dark forest anecdote, acceptance means that instead of trying to keep finding your way out, a time comes when you have to build a shelter or find a safe place to sleep. 

Adaptation means listening and observing, and a chance to see what the forest at night has to offer. Think of all the things you would have never found if you had not been placed in a new environment? Ask yourself, what’s an innovative way of experiencing a challenging market? What am I comfortable with when it comes to risk and strategy? What do I know to be true of markets in general? What’s happening when I accept and quiet down into this space? What new trends or opportunities are coming to light? 

There’s always something to be found in the darkness that you can’t find in the light. In order to do that, you have to proverbially embrace the darkness. Stop trying to walk through it like it’s daytime, instead, see what gifts or information is hidden within it.  

Thomas DrogeThomas Droge is one of today’s leading teachers in the field of meditation and conscious leadership. His methods focus on the tools he has coalesced over the past 40 years from the disciplines of meditation, medicine, movement, and neuroscience. He has degrees in integrative East Asian medicine from the US and China, and is a graduate from Harvard’s Mind Body Medicine program.

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