How to stay calm in a volatile market. Important practical guides | investing

5 Psychological Tricks for Keeping Calm During Market Volatility

For one group of investors, the end of 2018 was a harrowing experience of volatility. In just four months, the Nasdaq fell more than 23% -- a drastic short-term drop. Certain stocks were hit particularly hard: Netflix, Amazon, and Apple saw shares fall by one-third. People phoned their brokers, pulled out their hair, and endured sleepless nights, fretting about whether their precious nest eggs were gone forever.

If this seems extreme, imagine (or recall) what the Great Recession of 2008 was like. Stocks dropped 50% from their peak to trough. Decades of savings and investment gains were wiped out in one fell swoop! This wild volatility created crippling stress for many and put plenty of people's financial futures in jeopardy.

And yet, there has always been a second group with a distinctly different investment strategy. We don't hear much about them, because these people tend not to draw much attention. They have developed ways to cope with wild market swings and movements in such a way that their life isn't affected by volatility. Not only do these people experience equanimity, but they tend to perform better as investors as well. Their time in the market has taught them that such episodes represent a time to buy -- not to panic.