Market Volatility is Normal—but Human Reactions Often Are Not
By: Michael J. Boosel, CFP® Managing Director, Senior Investment Consultant

The Costliest Mistake Investors Make—and How a Good Plan Helps You Avoid It

Periods of market volatility have a way of testing even the most disciplined investors. Headlines grow louder; forecasts become more confident, and the urge to “do something” can feel overwhelming. In these moments, many investors begin to wonder whether avoiding the next downturn—or waiting for the perfect moment to invest—might improve their long-term- results.

History suggests otherwise.

Over decades of market cycles, one lesson has remained remarkably consistent: attempting to time the highs and lows of the market has never been a dependable strategy, particularly for investors with long-term- retirement goals. In contrast, those who build and follow a thoughtful financial plan tend to experience better outcomes—not because they avoid volatility, but because they are prepared for it.

Market Volatility is Normal – But Human Reactions Often Are Not

Market declines feel extraordinary when we are living through them, but they are a normal part of long-term investing. What tends to cause lasting damage is not the volatility itself, but how investors react to it.

The COVID-19 pandemic in early 2020 is a powerful example. In just over a month, the S&P 500 fell nearly 34%, bottoming at a closing level of 2,237.40 on March 23, 2020. The speed and severity of the decline created intense fear, and many investors moved to cash believing further losses were inevitable.

Yet the recovery began far sooner than most expected. By August 2020, the S&P 500 had already reached new all-time highs, fully recovering its pandemic losses in roughly five- months. By December 31, 2025, the index closed at 6,845.50—more than three times its pandemic low, representing a gain of approximately 206% over about five and a half years.

To put that in perspective, an investor who sold $500,000 from an S&P 500-based portfolio at the March 2020 low and stayed out through the end of 2025 would have missed that portfolio growing to roughly $1.53 million- (price index only). That is more than $1 million in missed growth, not including dividends.

Volatility created discomfort…but emotion determined the outcome.

Why Market Timing Fails in Practice

Market timing is appealing in theory. In practice, it requires investors to be right twice—when to sell and when to buy back in. Markets rarely provide clear signals for either decision, and recoveries often begin when fear and uncertainty are still high.

Legendary investor Peter Lynch (former manager of Fidelity’s Magellan Fund), summarized this challenge perfectly:
“Far more money has been lost by investors trying to anticipate corrections than lost in the corrections themselves.”

Similarly, Warren Buffett has long reminded investors that:
“The stock market is designed to transfer money from the active to the patient.”

Both observations point to the same conclusion: frequent action driven by prediction and emotion has historically worked against investors, while patience and discipline have worked in their favor.

The Real Risk: Making The Big Mistake

The greatest danger to long-term success is rarely the market decline itself. It is the emotional decision to abandon a sound strategy at the wrong time.

A common (and costly) pattern is selling after markets have already fallen, then waiting for “certainty” before reinvesting. Unfortunately, by the time conditions feel safe again, markets have often already moved higher. The result can be a permanent gap in returns that is difficult to recover from, especially for retirees or near retirees.

Another version of this same mistake occurs when an investor becomes convinced that “the market is too high.” Concerned that a correction must be coming, the investor sells an equity portfolio to wait for a better entry point. The problem, of course, is that markets do not move on schedules or valuations alone. Markets can remain “high” for long periods of time while continuing to climb, and corrections often arrive later—and recover faster—than expected. In the meantime, time and compounding continue to work for investors who remain disciplined, while those on the sidelines risk missing meaningful gains.

The COVID-19 recovery is a powerful example of both forms of this mistake. Some investors sold near the March 2020 lows out of fear. Others sold later as markets rebounded, believing prices had risen “too far, too fast.” In both cases, many of those investors struggled to get back in and missed a recovery that ultimately more than tripled the market over the following five and a half years.

These examples reinforce a simple but critical lesson: the biggest investment losses often come not from market declines, but from emotional decisions made in response to them. Staying aligned with a thoughtful, long-term plan has historically been far more effective than reacting to fear—or trying to predict when markets have gone “too far.”

The Bottom Line

Markets will always experience periods of uncertainty and volatility. What investors can control is not the timing of markets, but their preparation for them.

A strong retirement plan is not designed to avoid downturns. It is designed to help investors endure them, remain focused on long-term goals, and avoid decisions that can cause lasting harm. Over time, disciplined planning has proven far more effective than trying to anticipate- the market’s next move.

Our Perspective as Your Advisors

At The Boosel Ringwala Group, we firmly believe that disciplined planning—not market timing—is the foundation of longterm investment success. We do not believe markets can be consistently forecast or timed. Instead, we focus on owning asset -allocated, diversified portfolios of -high-quality- investments. We proactively asset allocate our clients’ portfolios and regularly rebalance, so we don’t have to be reactive when difficult markets occur.

Our role is to help you stay focused, avoid emotional decisions, and remain committed to a strategy designed to support your long-term- goals—through both calm markets and turbulent ones.

Client's Corner by Nick Murray

JUST THE OTHER DAY, I WAS AT A LOVELY CLUB IN downtown Jacksonville, Florida, waiting to speak at a luncheon meeting of about a hundred financial advisors. Suddenly, one of the advisors came bursting out of the room where the audience was finishing their lunch, and accosted me. “One question,” he said, “and I want your honest answer.” (As if I ever give anyone any other kind—maybe he was thinking of himself.)

“The United States is bankrupt,” he began. I was constrained to stop him there, and to report, in no particular order, that (a) I was unaware that the United States was, is currently, or is about to go bankrupt, and (b) that wasn’t a question.

He babbled on—I couldn’t follow most of it—until I simply had to excuse myself on the grounds that I was preparing a talk to a hundred people. As he wandered away, I thought, “Wow. This is getting pandemic. Now it’s not just the investors who are getting the Debtmageddon phobia; the disease is spreading to advisors who should know better.”

Hence this little essay.......

(click here to view the article).

From Powell to Warsh: What a Potential Fed Leadership Change Signals for Investors

By: Michael J. Boosel, CFP® Managing Director, Senior Investment Consultant

This morning, President Donald Trump announced that he plans to nominate Kevin Warsh as the next Chairman of the Federal Reserve, replacing Jerome Powell when Powell’s term as Chair ends later this spring. While the nomination is subject to Senate confirmation, this development has understandably raised questions about what a potential change in Fed leadership could mean for markets and investors.

Who Is Kevin Warsh?
Kevin Warsh is a familiar name in financial and policy circles. He previously served as a member of the Federal Reserve Board of Governors from 2006 to 2011, including during the global financial crisis. During that period, he worked closely with then-Chair Ben Bernanke and acted as a key liaison between the Federal Reserve and financial markets.

Following his time at the Fed, Mr. Warsh has remained active in economic policy and finance, combining academic work with private investment roles. His background includes experience on Wall Street, public service in the White House, and ongoing engagement with monetary policy research. For investors, his prior service at the Fed gives him institutional knowledge and credibility that markets tend to value.

When Would the Change Take Place?

Jerome Powell’s term as Federal Reserve Chair is scheduled to expire in...

(click here to view the article).

Odds & Ends

• Once again, tax time is almost upon us!  Please click here to view the Baird Tax Document mailing schedule to find out when Baird will be sending out certain tax documents.  Please also remember that you can also access your tax documents electronically via Baird Online once they are ready.  It is easy for you or your tax professional to electronically upload your Baird tax documents into the appropriate tax software.  If you need instructions on this or have questions, you can contact taxreporting@rwbaird.com or call the Baird Tax Reporting Help Line at 1-888-792-1099.
  

• Fulton County seniors are set to receive expanded property tax relief beginning in 2026, thanks to a new senior homestead exemption that will now be applied automatically for eligible homeowners. Recent clarification from county officials confirms that those already holding a homestead exemption do not need to submit a separate application, simplifying access to these valuable tax benefits. Read the full update here.
• Michael Antonelli, Private Wealth Management Market Strategist, tackles the topic of Gold and Silver in his latest Bull & Baird blog post. Click here to read the article.

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