“Investors should remember that excitement and expenses are their enemies. And if they insist on trying to time their participation in equities, they should try to be fearful when others are greedy and greedy when others are fearful.”
-Warren Buffett
This month, my net worth decreased by approximately $28K. There are those who might believe that this is cause for concern. However, a smart investor is not swayed by the short-term ups and downs of the market. He understands that the nature of the stock market is volatile and that in the long run, there is still no better vehicle for building your net worth.
So, how should you react to the current market crisis? I’ll tell you what you shouldn’t do. You shouldn’t be like everyone else and withdraw all your money or stop investing. In fact, you should be happy that the stock market is on sale and that shares are cheaper than before. To sell or stop buying after a market crash is to violate the principle of buy low, sell high. Instead you end up selling low and by the time you get back in the stock market, you will most likely have missed a fleeting window of opportunity to recoup your money. I believe that you should take the following actions:
1) Continue to invest as if nothing happened.
2) Continue to live your life.
Don’t worry about what the market is doing right now. You’re investing for the long term.
