Putting market declines in perspective

When stock prices begin falling dramatically, it can appear that your only option is to sell to limit losses. But we disagree – if you are a long-term investor, the difference between success and failure may be determined by your actions during a stock market decline.

Long-term investors will likely experience numerous market declines through the years. Consider the following table:

Declines in the Canadian stock market since 1973

^{Source:  MSCI Canada Index, FactSet, Edward Jones calculation: 1/1/1973 - 12/31/2023. Past performance does not guarantee future results. Market indexes are unmanaged and cannot be invested into directly and are not meant to depict an actual investment.}

The next time the market has a hiccup, take a deep breath and remember this advice:

• Market declines are normal, frequent, and not a reason to sell quality investments.
• Market declines begin and end without warning.
• Market declines provide an opportunity to buy quality investments at a potentially lower price.*
• Market declines create opportunities for those who maintain a disciplined approach to investing and avoid making decisions driven by emotion.

Market declines can test the nerves of even the most patient investors. If you own a diversified mix of quality investments, resist the temptation to sell or make changes based on short-term events.