Here's How Often a Correction Leads to a Bear Market (Hint: Not as Often as You Might Fear)
The Nasdaq Composite (NASDAQINDEX: ^IXIC) and the S&P 500 index (SNPINDEX: ^GSPC) have both recently dipped into correction territory. The media made a very big deal of that fact, though the S&P 500 index quickly bounced back from its 10% decline the very next day. Still, investors' emotions are running high amid increased market volatility.Some important historical facts about the markets might help lessen their anxiety -- and could even encourage them to jump back into the market.If you're going to invest in stocks over the long term, the one fact you have to come to grips with is that Wall Street is a fickle place. Stocks will go up; stocks will go down; and it won't always be for obvious reasons. That's true on an individual level and at a group level, from sectors to the market as a whole. It can be emotionally uncomfortable to own stocks.Continue reading
The Nasdaq Composite (NASDAQINDEX: ^IXIC) and the S&P 500 index (SNPINDEX: ^GSPC) have both recently dipped into correction territory. The media made a very big deal of that fact, though the S&P 500 index quickly bounced back from its 10% decline the very next day. Still, investors' emotions are running high amid increased market volatility.
Some important historical facts about the markets might help lessen their anxiety -- and could even encourage them to jump back into the market.
If you're going to invest in stocks over the long term, the one fact you have to come to grips with is that Wall Street is a fickle place. Stocks will go up; stocks will go down; and it won't always be for obvious reasons. That's true on an individual level and at a group level, from sectors to the market as a whole. It can be emotionally uncomfortable to own stocks.
