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Why Every Market Dip Feels Different – But Isn’t

Signature Wealth Concepts, LLC |

If you’ve ever caught yourself thinking, “this time feels different,” when the markets get rocky—you’re not alone. Every bout of market volatility seems to come with a fresh wave of fear, anxiety, and doubt. Even seasoned investors who’ve been through multiple downturns find themselves asking the same question: Is this the one we won’t recover from?

That emotional response is entirely human. In fact, it’s normal. But here’s what’s also true: Volatility is not a new phenomenon—it’s part of the ride.

Volatility Is the Price of Admission

Markets move up and down. That’s not just a fact—it’s the price investors pay for long-term growth. Without risk, there is no return. If the market only went up, everyone would invest, and the returns would vanish. The volatility we experience—whether it’s due to interest rate shifts, global conflict, political instability, or unexpected economic data—is a reflection of real-time information being priced in. It’s also a reminder that we are investing in a dynamic, ever-evolving world.

Still, knowing that volatility is “normal” doesn’t make it feel any less unsettling.

Why It Feels Different Every Time

Each downturn is shaped by a unique set of headlines. In 2020, it was a global pandemic. In 2008, it was a financial crisis. In 2001, it was terrorism and the dot-com collapse. In the current and coming years, it might be inflation, geopolitical tensions, or AI-driven market shifts.

Because the stories change, our brains process each moment as new and potentially more dangerous. We also have more access to 24/7 news and social media than ever before—making the swings feel more dramatic and urgent.

But the feelings of fear, uncertainty, and doubt? Those haven’t changed. They’ve been with us during every downturn. And history has shown time and time again that markets recover.

The Cost of Emotional Decisions

When volatility spikes, the temptation to “do something” often becomes overwhelming. We want to protect ourselves, go to cash, or move into something that feels safer. But emotional decisions during turbulent markets are often the most damaging.

A Dalbar study1 on investor behavior consistently shows that the average investor underperforms the market—not because of poor investment choices, but because of poorly timed decisions. People sell when markets are down, miss the rebound, and buy back in too late.

Missing even a few of the market’s best days—most of which occur during periods of high volatility—can drastically impact long-term returns.

Perspective Is Power

One way to approach this challenge is to zoom out. The day-to-day headlines are noise. What matters is your long-term plan—your goals, time horizon, and risk tolerance.

Ask yourself:

  • Has my financial situation changed?
  • Have my goals shifted?
  • Is my portfolio still aligned with my timeline?

If the answers are no, then the best course of action may be to stay disciplined and trust the plan that you have put in place.

What You Can Control

While we can’t control market volatility, we can control our response to it. That includes:

  • Rebalancing your portfolio periodically to stay aligned with your strategy.
  • Tax-loss harvesting during downturns to improve your after-tax returns.
  • Staying invested and resisting the urge to time the market.
  • Reviewing your financial plan with your financial advisor to ensure it still reflects your goals.

Volatility isn’t a sign your plan is broken—it’s the reason you have a plan in the first place.

Final Thoughts

Every market downturn will feel different. But that doesn’t mean your strategy should. Market volatility is an expected part of investing, and while it tests our emotions, it also provides opportunities—for learning, rebalancing, and growing.

If you’re feeling anxious about the markets, connect with your financial advisor. Sometimes the most valuable investment isn’t in a stock or fund—it’s in a conversation that keeps you grounded.

 

1 “Investor Behavior Continues to Hinder Returns,” www.dalbar.com April 11, 2024

This article was curated by Signature Wealth Concepts and is being provided for informational purposes only based on our general understanding of the subject matter. Past market performance is not indicative of future results.

Duly registered and duly licensed financial professionals with Signature Wealth Concepts offer securities through Equitable Advisors, LLC (NY, NY 212-314-4600), member FINRA/SIPC (Equitable Financial Advisors in MI & TN); offer investment advisory products and services through Equitable Advisors, LLC, an SEC-registered investment advisor; and offer annuity and insurance products through Equitable Network, LLC (Equitable Network Insurance Agency of California, LLC; Equitable Network Insurance Agency of Utah LLC; Equitable Network of Puerto Rico, Inc.). Equitable Advisors and Equitable Network are affiliates and do not provide tax or legal advice or services. You should contact your personal tax and or legal advisors regarding your specific situation before taking action. Signature Wealth Concepts is not owned or operated by Equitable Advisors or Equitable Network. PPG -7885874.1 (4/25) (Exp 4/29)