Market volatility can be unsettling. No investor, whether a beginner or someone who has been saving for years, enjoys seeing their portfolio value decline, even temporarily. This also includes the inbestMe team and its experienced investment committee.
When the market falls, some investors choose to sell to “limit losses,” while others stop making new contributions. Both decisions are usually mistakes that can prove very costly in the long run.
Our recommendation is clear: do not act impulsively.
Stick to your strategy and continue investing regularly even when the market declines. Why? Because history shows that markets behave predictably in the long term. They have an upward long-term trend, and investors who stay invested ultimately reap the rewards of patience.
We want to help you stay calm. In this article, we provide historical perspective on past global market declines and show what inbestMe clients who stayed the course have achieved.
Market declines are very common
Market corrections can be frightening, but it is essential to remember that they are completely normal. The chart below shows the last 40 years of the S&P 500: each blue bar represents annual returns, and each red dot represents the largest intra-year drawdown. A key takeaway: the average intra-year decline has been -14%, yet the average annual return has been +10%.
For example, in 2025 the market fell 15% during the tariff war triggered by Trump, but ended the year up 16%.
Similarly, during COVID there were severe intra-year declines of up to 34%, which ultimately became irrelevant for those who stayed invested, as the year also closed with a 16% gain.
The key is not to avoid declines, but not to react to them.
Historically, markets rise in the long term
The declines shown in the chart can feel alarming in the moment, but if you have a long investment horizon, they are just small bumps along the way. It is also true that not every year ends positively: in 2022 the market fell as much as -25% and closed at -19%. The most extreme case was 2008, when it fell -48% and ended at -38%.
However, both the S&P 500 and the MSCI World, a global benchmark index, have generated an annualized return of approximately +10% over the long term, despite passing through financial crises, wars, pandemics, and recessions.
Recent declines have been linked to the war with Iran. As shown in the chart above, history has been filled with conflicts, and yet markets have consistently recovered after initial drops.
Of course, recent years have been extraordinary in some respects. However, neither the 2020 pandemic nor the 2022 rate-hiking cycle has altered the trajectory of major equity indices. The overall trend remains the same: markets rise over time.
Even though markets are falling quickly, they are rising more and more for longer.
Even in the most severe bear markets (declines greater than 20% from highs), historical recoveries have been much faster than investors typically expect.
Selling during a decline means turning a temporary loss into a realized loss.
inbestMe clients who stayed the course: results speak for themselves.
Clients who trusted their investment plan over the past 9 years, including the COVID crisis, the war in Ukraine, and the interest rate hiking cycle, achieved results far above the industry average. Data from January 1, 2017 to December 31, 2025 are compelling:
inbestMe average annual return (TAE): 5.2%, compared to Inverco’s average of 2.6%. In other words, double the annualized return over 9 years.
Investors who remained calm achieved cumulative returns of up to 119.2%.
The average investor profile (7 out of 10) at inbestMe accumulated a return of 79.1%, which is 55 percentage points higher than the “Mixed Equity” category according to Inverco, at 23.8%.
Declines are an opportunity, not a threat
We encourage you to view market declines for what they truly are: an opportunity. If you continue investing when prices are low, you are buying more units at a lower cost—like shopping during a sale. This is exactly what makes periodic investing so powerful.
Periods of volatility also highlight the importance of diversification. At inbestMe, we do not invest in a single company, sector, or country: we build globally diversified portfolios using index funds and/or low-cost ETFs, reducing the impact of any single downturn and helping you stay calm.
You may have heard about “buying the dip” or waiting for the market to hit bottom before reinvesting. It sounds appealing in theory, but is practically impossible: no one knows when the bottom has been reached until after it has passed. Academic research confirms that trying to time the market carries more risks than benefits.
That is why our recommendation is always the same: stick to your investment plan. At inbestMe, we take care of the rest: automatic rebalancing, global diversification, and tax optimization.
Your only job is to follow your plan and avoid impulsive actions.
Trust your plan or review it after the storm passes
We understand that staying calm when markets fall is not easy. It is deeply human to feel the urge to “do something.” But the data is clear: clients who stayed disciplined with their strategy over 9 years, through multiple periods of significant market stress, achieved cumulative returns of up to +119.2%. The average investor achieved +79.1%, and the overall average across profiles was +62.3%, clearly outperforming benchmarks.
The secret? None in particular.
Globally diversified portfolios, low costs, automatic rebalancing, and above all, not selling when the market falls.
And at most, once the storm passes, review whether your risk profile is still appropriate.
If you felt too much discomfort during downturns, you may have taken on more risk than you could truly tolerate.
