Managing Real-World Market Fears

It can be hard to focus on your investment fundamentals when a stock or sector runs hard. This fear is manageable.

- Simon Brown

Fear is a stark reality in the markets for most investors. We fear the markets for two key reasons: fear of missing out (fomo) and fear of being wrong. They have some common traits between them but in many cases are separate and have different solutions for helping to remove the fear.

I have written many times about fomo, either directly or implicitly. We see a stock running higher and we worry that there is money being made and we’re not making any of it. Our gut response is then to jump in without really knowing what’s causing the run nor how we plan to get out. Often the fear causes us to enter too late.