Image Credit: Alex Nabaum
By Jason Zweig |Â
When stock markets fall sharply and immediately recover, the losses seem to disappear. But that doesn’t mean no one feels any pain.
The Dow Jones Industrial Average fell 617 points, or 2.4%, on Monday—then promptly went up by an almost identical amount over the next three days. If you headed off for a hike in the wilderness on May 10 and came back on May 16, you might have concluded that nothing had happened: Over the full stretch of those four trading days, the Dow ended up just about where it started.
But big market moves, like flashbulbs that go off in your face, do blur your vision—whether investors realize it or not.…
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For further reading:
Books:
Benjamin Graham, The Intelligent Investor
Jason Zweig, The Devil’s Financial Dictionary
Jason Zweig, Your Money and Your Brain
Jason Zweig, The Little Book of Safe Money
Articles and other resources:
When the Stock Market Plunges…Will You Be Brave or Will You Cave?