3 Mistakes Investors Make During Volatile Markets

On December 31, 2018, the S&P 500 closed down -6.24%.  During this time the VIX index, which measures the amount of fear in the market, spiked to over 30 points.  For comparison’s sake, the VIX in 2017 was below 12.  This amount of emotion in the markets can build irrationality into investor’s decisions, and can negatively impact investment performance results long-term. reported that “Successful investing is hard, but it doesn’t require a genius…As much as anything else, successful investing requires something perhaps even more rare; the ability to identify and overcome one’s own psychological weaknesses.” Behavioral Finance experts, like Brett Steenbarger, have identified several traps investors unknowingly fall into when emotions run high. Below are the three frequent mistakes investors make during volatile markets.

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