Why Staying Invested During Tough Markets Matters More Than Ever

Watching your investments fall during uncertain times is not fun.

When headlines are screaming about wars, inflation, interest rates, pandemics, or financial crashes, it’s only natural to ask:

“Should I sell everything and sit in cash until things calm down?”

It’s a very human reaction. And it’s exactly why this article exists.

Here, we’ll look at:

• Why staying invested during uncomfortable times matters

• What history teaches us about market crashes

• Why trying to “outsmart” the market often backfires

• And how long-term investors quietly win the game

The Problem With “I’ll Just Wait It Out ”

You’ve probably heard this advice before:
“Only invest money you won’t need for at least five years.”

Most people nod wisely when they hear it. It makes sense. Markets go up and down. Time smooths out the bumps. Long-term investing reduces early losses and absorbs short term costs.

Where things get difficult is when markets start falling.

That’s when:

• Logic disappears

• Emotion takes over

• And the sell button starts looking very tempting

Clients often call asking:

• “Should I move everything into gold?”

• “Should I pull out until things feel safer?”

• “Is this the big one?”

These are completely reasonable questions. It’s scary seeing your money shrink. It feels helpless. And when your portfolio starts tunnelling downward like a homesick mole, your brain screams:

“STOP THIS NOW.”

Add in nonstop media drama about billions being wiped off markets and suddenly it feels like the end of investing forever.

Spoiler alert:
It’s never actually been the end of investing.

A Lesson From the 2008 Financial Crisis

I was working in London during the 2008 crash. I watched people leave their offices with no job the next morning. However, whilst individual lives changed forever in a day, it did not take long for the financial papers to quickly zoom out from the situation.

On Monday:
“The system has collapsed.”

On Tuesday:
“The greatest buying opportunity of a generation.”

This cycle repeated every single day. Once markets recovered, headlines switched from panic to predicting the next crash… for the next decade.

Meanwhile, many investors sat in cash waiting for “the perfect moment.” And they missed one of the longest bull markets in history.

Markets Crash. Always Have. Always Will.

To make this real, let’s zoom out.

Black Monday – 1987

Markets dropped 22% in a single day. Absolute chaos.
Today? Barely a blip on a long-term chart.

The Dot-Com Bubble – 2000

The tech sector collapsed. The NASDAQ fell 78%.

If you invested at the peak, it took until 2013 to fully recover. Brutal, but not permanent.

Diversified investors fared far better. Emerging markets surged. Bonds stabilised portfolios. Global diversification mattered.

The 2008 Financial Crash

This one felt like the end of the world.
Banks collapsed. Credit froze. Property markets crashed.

And yet:

From 2009 onward, the longest bull market in modern history began.

COVID – 2020

Global economies voluntarily shut down.
Markets collapsed and then recovered faster than almost anyone predicted.

Many portfolios ended the year higher than where they started.

The Pattern?

Every crisis feels unprecedented. Every recovery feels unimaginable, until it happens. Take a look at the S&P 500 (top 500 companies registered on the US Stock Market) since 1952.

The Market Has the Personality of the Worst Flatmate Ever

Markets are:

• Emotional

• Irrational

• Reactive

• And deeply unpredictable

Good news? Markets jump.
Bad news? Markets drop.
Sometimes they drop on good news and rise on bad news, just to keep everyone confused.

Trying to predict short-term movements is like trying to guess tomorrow’s headlines. Even the smartest economists can’t do it consistently.

Over weeks and months? The market is chaos.
Over decades? The trend is surprisingly clear.

Long-Term Strategy Beats Short-Term Guesswork

Long-term investing works because it removes the noise.

Short-term trading:

• Increases cost

• Increases stress

• Increases the chance of poor timing

• Rewards very few people consistently

Long-term strategy:

• Relies on diversification

• Focuses on growth trends

• Uses evidence, not emotion

• Let compounding do the heavy lifting

There is a role for adjusting portfolios sensibly over time, this is called tactical asset allocation. But this is not the same as panicking in and out of markets every time volatility appears.

The “Best Days” Problem

Here’s a powerful data point:

According to Fidelity, if you had invested $10,000 from 1980 to 2020:

• Stayed fully invested = $697,421

• Missed just the 10 best days = $313,377

That’s a loss of nearly $384,000
…for stepping out at the wrong moment.

You don’t miss the best days by being reckless.
You miss them by waiting for things to feel “safe again.”

The Turtle Traders: A Powerful Psychological Lesson

There’s a famous experiment where traders were trained using a system where 60% of all trades lost money, and yet the group still became wildly profitable over time.

Why?

Because they trusted the strategy and stuck to it.

Long-term investing works the same way:

• You will have losing months

• You will have scary drawdowns

• You will feel uncomfortable at times

But history shows that a disciplined, diversified strategy overwhelmingly wins over time.

The Real Secret: Control What You Can Control

You can’t control markets.
But you can control:

Your asset allocation
Your diversification
Your investment costs
Your tax efficiency
Your time horizon
Your behaviour during downturns

And ironically, behaviour is often the biggest driver of long-term success.

Final Thought

Markets are driven by fear and greed.
Your job as an investor is to avoid letting either one hijack your decisions.

Staying invested during uncomfortable periods is not easy, but it is exactly what long-term success demands.

If you’d like to talk through how your portfolio is positioned, how much risk you’re taking, or how to stay invested with confidence, AWN Financial Advisory is always happy to help.

Please consult with your financial advisor and/or tax professional to determine the suitability of these strategies. All views, expressions, and opinions in this communication are subject to change. This communication is not an offer or solicitation to buy, hold, or sell any financial instrument or investment advisory services.