Should I be worried?

I was looking at my retirement fund elections today and my portfolio has taken a 7% hit as stock prices continue to fall. Should I be getting worried or are things going to level out soon? I am afraid of losing money in my account that I have worked so hard to earn and grow.

 

My shares have also fallen down by 8.5% but I'm still positive that things will catch up soon. I remember my friend who shared her experience during the 2008 crisis and she said she was really worried when she saw the numbers turn to negative but her gut instinct told her not to withdraw anything and hold on until the crisis is over. Good for her, she was able to gain big when the market started to catch up once again.

 

I am trying to keep my cool as well, but have learned this is part of the stock market. This particular correction is unique in that oil plunged, the dollar is inflated, world economies are weak, there was a bond bubble as well as letting interest rates stay too low for too long...etc. This is what happens when the government and the Fed tries to put their hands on everything and "fix it. It led to over confidence in the market too.

That said, I got in to the market on my own 3 days before oil crashed. I am down 11%, and that's WITH having made several hundred dollars playing with the volatility over the last few days. We will see a rally and turn around eventually, it's just a matter of waiting it out. These are those moments in the market when people panic and lose a ton of money. Don't let emotions dictate your moves. If you have solid investments and a diversified portfolio, you will come out on top again in the end

 

You might like to think about having a small fraction of your retirement money in a fund which hedges your main portfolio. You don't need to work this out yourself as a good broker should be able to sort it for you. It isn't a guaranteed way of keeping your money safe, but it can be prudent, especially if a major event hits the markets.

 

Thanks for the replies, I feel a little better now. It is just a sickening feeling when you think about losing money that is supposed to carry you through in your retirement years.

 

When you invest in stocks, you should have prepared yourself for eventualities like the sudden downfall of the index for some reason or another. As the brokers will tell you, the stock exchange is a gamble since there is nothing definite when it comes to stock prices and there no stable stock since even the blue chips would tumble down in eventualities. But for the present predicament, my advice is to hold on to your stocks and it will stabilize sooner or later.

 

A 7% loss shouldn't frighten you, especially since you probably have larger gains in the past. That being said, a 7% fall is not much, we could be seeing much more. But as the others have said, at some point it will balance out. Consider these dips as a buying opportunity.

 

^ This. I don't like losses either. However, such dips can provide good buying opportunities. I know when the market disintegrated in the 2008 meltdown, for example, I was able to pick up some real bargains.

 

I am down about 10% so you are doing better them me. If the market is down a diversified portfolio will almost always be down. The same advice still holds. Wait it out. Selling low is the very worst thing to do. Buying low is generally a good idea if you have the capital to invest.