Why You Shouldn’t Fear Stock Market Volatility
You can, and should, take advantage of stock market jitters.
“Over the long term, the stock market news will be good. In the 20th century, the United States endured two world wars and other traumatic and expensive military conflicts; the Depression; a dozen or so recessions and financial panics; oil shocks; a flu epidemic; and the resignation of a disgraced president. Yet the Dow rose from 66 to 11,497.“
— Warren Buffett
Market volatility is a common occurrence when it comes to investing.
Over the past decade, the S&P 500 index has seen drops of between 5% to 10% almost every year. Some years saw more declines, like in 2020 and 2022.
But it’s during those drawdowns that opportunities lie.
Because over the long term, the stock market has gone on to march up higher, despite all the headwinds.
And those short-term drawdowns seem like a non-event if you zoom way out.
So, as long-term investors, we should embrace market volatility, instead of fearing it.