It wasn't easy for equity investors to maintain their discipline during so much disruption. But it was crucial. Running to cash when the outlook is poor seems like a safe strategy during difficult times. But it isn't. It hasn't worked in the past. And it's unlikely to work in the future. Look back at every market sell-off of the last 200 years and, with the luxury of hindsight, you can plainly see that each was a buying opportunity. When markets get hit hard, however, people feel emotional. They feel a strong need to do something. And, unless you have unusually strong contrarian instincts, that something is usually the wrong thing. Down markets are generally caused by unexpected events. Consider Saddam Hussein's invasion of Kuwait in 1990, 9/11 in 2001, the collapse of Bear Stearns and Lehman Brothers in 2008, the global pandemic that began two years ago and Russia's invasion of Ukraine this year. All of these events felt like a bolt out of the blue. And for a very good reason: They were. Most investment advice is geared toward what investors should do. But it's what you don't do on that small number of days when you feel terrified that is absolutely vital. As Warren Buffett points out, the most important quality for investors is not intellect but temperament. When it comes to the stock market, you're better off being a calm and deliberate individual of common sense than a volatile genius. Especially if that good sense is informed by a historical perspective. Bad things happen sporadically and suddenly, as cataloged above. But good things occur regularly and generally take time. The rolling returns on equities are remarkably consistent. Historically, the odds of making money in the U.S. stock market are 50-50 in one-day periods, 68% in one-year periods, 88% in 10-year periods and 100% in 20-year periods. That's something to remember whenever stock prices stumble, as they did in the first quarter of 2022. History clearly demonstrates that nothing outperforms a diversified portfolio of common stocks over the long term. Or - better still - a diversified portfolio of uncommonly good ones. Good investing, Alex | 
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