Ignore the Hype. Brian Perry

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      When you are in the accumulation phase of your financial life, a crisis and the falling prices it presents allow you to accumulate additional shares while they are “on sale.” In effect, falling markets help you to dollar-cost-average your portfolio, as your (hopefully) systematic contributions to retirement and other investment accounts purchase stocks at reduced prices.

      The concept remains valid once you've retired and entered the distribution phase of your financial life. That is because you should be systematically rebalancing your portfolio during market declines, which means that you'll be selling assets that haven't fallen too much in value and using those proceeds to purchase additional amounts of the most beaten down assets. This is another form of dollar cost averaging, and although adhering to this discipline requires a level of mental fortitude, the results can be worth it, because the more stocks you can buy “on sale,” the better off you'll ultimately be. And keep in mind that, even in retirement, many of your assets are ultimately earmarked not for next month or next year but rather for a decade or more into the future.

So, the next time there's blood in the streets and markets are in free-fall, try to take a deep breath, relax, and systematically rebalance your portfolio. Because individuals who do that, while staying the course with their stock exposure, ultimately have far better odds of meeting their financial goals than people who move in and out of the markets based upon recent price action.

      Sadly, many people lack the discipline to set and follow an appropriate strategy, so let me repeat myself one more time: don't swim against the tide. Be disciplined. Let the long-term upward trend of markets propel you to your financial goals.

      Or, instead, you could try to successfully trade based upon forecasts of what the future holds. So now let's shift our attention and take a closer look at how well that strategy has historically paid off.