Markets have been extremely volatile in the last few months, and while it’s true that volatility is normal and even healthy, it doesn’t necessarily mean it is a welcome occurrence for everyone. However, that unpredictability can be used as a tool to help you evaluate your true risk tolerance to prepare yourself and your portfolio going forward.

Despite the recent gyrating stock market, the economy is still doing quite well based on many indicators. Since October 2018, the stock market is down over 10 percent and in some sectors down almost 20 percent. Does this mean we are entering a recession? A recession is technically defined as a period where Gross Domestic Product (GDP) declines in two consecutive quarters. GDP is the total revenues earned by a country for a given period of time. Based on the factors mentioned below, many of the current economic indicators do not point towards a recession in the near future. That’s not to say a recession will not occur at some point.