Recent market drop has been stomach churning. If you are a relatively new investor who entered the market past 2 years when it was smooth sailing, it is only natural to be terrified by the wild swing.
In this article I share some opinions on why such drop is to be expected and offer some ways to stay afloat in such market conditions.
1 – Have a right perspective for this market drop
Majority of investors’ fears were stoked by scary news headline such as ‘Dow plunges 1,175 – worst point decline in history’, ‘Dow and S&P 500 now officially in correction’.
|CNN Money headline on 5th Feb|
But the fact is that US markets had one of the strongest bull run in history that lasted for 9 years since 2008 GFC. Plus, past 2 years’ rise had been particularly relentless, from 16,000 to around 26,600, a 66% rise.