We’ve all been there. The news is grim and your stomach drops faster than the stock ticker. Whether it’s your retirement account, college savings, or nest egg for that dream vacation home, market volatility can feel deeply personal.

It’s natural to feel unsettled. But while market dips may feel like new and terrifying territory, history tells a different story—this isn’t unusual, and it’s not the end of the world. In fact, long-term investors who can stay the course often come out stronger.

Let’s break down why staying calm and focused during downturns is more than just good advice—it’s a data-backed strategy.

Volatility Isn’t Rare—It’s Part of the Deal

Market pullbacks happen more frequently than many investors realize. From 1972 through 2024, global markets experienced a 10% or greater drop in 30 of 53 years. Even more substantial corrections of 20% occurred in 13 of those years—roughly once every four years. And we’ve already seen it happen in 2018, 2020, 2022, and 2025.1

It may feel unprecedented in the moment, but it’s not. Volatility isn’t a bug in the system—it’s a feature.

Time in the Market Beats Timing the Market

Investing for the long haul usually pays off. While holding cash may seem like the safer option, it often fails to keep up with inflation. Over the five years ending April 4, 2025, global equities doubled in value, while cash gained just 14%. A $10,000 investment in the stock market would have grown to roughly $20,700, compared to just $11,400 in a cash equivalent. 1

Short-term investing is a toss-up. Data going back to 1926 shows that one-month returns in the U.S. stock market beat inflation about 60% of the time—barely better than flipping a coin. But stretch that time frame to five years, and your chances rise to nearly 80%. Over ten years, that number jumps to 90%. There has never been a 20-year period where stocks failed to outpace inflation. 2

In contrast, cash hasn’t beaten inflation over a five-year period since 2011. 3

Fear-Based Selling Often Backfires

The VIX Index, often called the “fear gauge,” measures expected market volatility. In early April 2025, it spiked to above 45—well above its historical average of 19. 4

An investor who sold stocks and moved to cash every time the VIX exceeded 33 (a historically rare level) would have earned just 7.0% annually. That’s far less than the 9.7% average annual return of someone who simply stayed invested in the S&P 500 Index. 5

In short: reacting emotionally to volatility could cost you thousands over time.

Sometimes Market Chaos Creates Opportunity

Market downturns often drag stock prices below their long-term value. That makes times of heightened volatility—while uncomfortable—potentially attractive for investors with cash on the sidelines. As of early 2025, valuations across global markets have become more attractive, particularly in non-U.S. markets. 6

A sudden change in policy—such as easing tariffs or interest rates—could quickly reverse negative sentiment and trigger a strong market recovery.

Stay Steady, Not Static

Everyone’s situation is different. Your risk tolerance, time horizon, and financial goals all play into how you should respond. But the data is clear: those who stay calm and committed tend to fare better than those who panic and pivot.

At Mirus Financial Partners, we help you focus on long-term goals rather than short-term noise. With the right strategy—and a trusted advisor—you can ride out the storm and keep your financial future on track.

Investing involves risk, including possible loss of principal. Past performance does not guarantee future results. Talk to your financial advisor before making any changes to your investment strategy.

Sources:

1. MSCI World Index, LSEG DataStream, Schroders Investment Management

2. Morningstar Direct, CFA Institute, Ibbotson® SBBI® US Large-Cap Stocks

3.  Ibbotson® US 30-Day Treasury Bills Index

4. CBOE VIX Index, Schroders

5. CBOE, LSEG DataStream, Schroders Investment Management

6. Schroders Investment Management