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What To Do When The Dow Drops 300 Points

Recs

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June 28, 2013 – Comments (0)

Do nothing.

Sit on your hands. Unplug your mouse and turn your computer off. Like my mom used to say when I was a wee lad, turn off the TV and go out and play.

Hopefully, your reaction is the same when the Dow goes up 300 points.

Please: you must have an investment strategy, of which there are many good ones you can find right here on TMF. However: this strategy must center on the long-term, and ignore one day's worth of ups or downs, no matter how stomach churning or euphoric.

When you get the urge to react to one day's stock market news, I suggest you open an adult beverage, open a bag of salty and fattening snacks, and relax. Your financial future will thank you.

And, yes, I know: one ought to be following SPY rather than DIA. I have an old financial planning text from the 60's saying that, despite the difference in approach, they track each other fairly closely. I have seen nothing in recent years to cast doubt on this opinion.

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