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I just shared that I’m trimming some of my Singapore blue-chip winners and reallocating into REITs and fixed income — sectors I think will fare better in uncertain times. But since I posted the article, the market has become extremely volatile, and quickly at that. The US stock market lost over $6 trillion in just two days — one of the steepest drops we've seen in recent times. I thought I’d jump in with a article to share the 5 things I’m doing (and not doing), and how I'm preparing for the possibility that things may get worse before they get better.
1. No Drastic Moves Just Yet
First off, I’m not panicking, and I’m not making any drastic changes, at least not yet. Corrections are part of investing — markets go up, markets go down. This isn't the first time we’ve seen a sudden sell-off, and it won’t be the last. If your portfolio is filled with strong, income-generating assets — like quality, diversified dividend stocks, REITs, and fixed income — the best thing to do right now is stay calm. No need to sell out of fear or rush in just because prices are dropping.
I get it, it can be tough to see the market moving in such a dramatic way. It feels like the ground is shifting beneath us. But here's the thing: panicking never pays off. In fact, emotional decision-making is one of the biggest obstacles investors face. When the market is in turmoil, it’s natural to think the worst is yet to come, but the truth is, the market always goes through cycles. It might feel like a bear market is upon us, but that doesn’t mean it’s the end of the road. Sometimes the best thing to do is wait it out and ride out the volatility, especially if you’re in assets that are built to withstand these kinds of downturns.
One of the hardest parts of investing is learning to sit through these inevitable corrections, but if you’ve done the hard work of selecting solid investments with long-term potential, the market downturn is nothing more than a temporary setback. Stick to your plan, and stay disciplined.
2. Reviewing My Portfolio
That said, I’m not sitting back doing nothing either. I’m reviewing my portfolio, asking myself why I own each asset and how it fits into the bigger picture. This isn’t the time to panic — it’s time to get curious. What’s going on in the broader market? What are the key catalysts behind the sell-off? What are my long-term goals, and how does this downturn impact them?
A downturn is a great opportunity to take a closer look at your investments. We often get caught up in the excitement of bull markets, but downturns allow us to re-evaluate the core of our portfolios. Are there assets in your portfolio that no longer align with your strategy or risk tolerance? Are you still confident in the long-term outlook for your holdings, or is it time to reassess your exposure? For me, this review process is about staying proactive, not reactive. I’m asking myself, “What’s the risk in holding this asset in the current market environment, and does that risk still make sense in the context of my broader investment plan?”
I’ve also pulled out my "crisis handbook." Okay, it’s not a leather-bound book, just a simple Google Doc I’ve kept over the years. The idea is the same: What’s my plan if markets drop another 5% or 10%? What should I avoid, and what would I buy at the right price? Having a systematic approach to downturns helps me remain disciplined, especially when fear starts to creep in. I’ll be sharing more details about how I manage these downturns in a future video.
3. Don’t Count Out a Reversal
Quick reminder: Markets can surprise us, not just on the downside, but on the upside too. Sharp sell-offs driven by fear or politics can sometimes reverse when sentiment shifts. While there’s real concern over trade, tariffs, and geopolitical tensions, there’s also a chance for cooler heads to prevail. Sometimes when the market overreacts to new policies or political changes, there’s room for reversals.
One thing I’ve learned from years of investing is that markets can be unpredictable, and sometimes, they can recover just as fast as they fall. For instance, some of the most significant rallies have followed steep declines, especially when those declines were driven by short-term panic or temporary issues. The key here is understanding that sharp market movements — whether up or down — are often short-term noise. It’s easy to get swept up in the panic and think that the decline will continue indefinitely, but history shows us that markets are resilient. The rebound might not be immediate, but it’s often quicker than we think.
It’s crucial to stay open to the possibility of a market reversal, even if it’s hard to see it happening right now. Yes, there’s a lot of uncertainty in the world right now — trade wars, inflation, rising interest rates, and geopolitical risks. But don’t rule out the potential for a recovery when these issues are either resolved or the initial shock fades.
4. Building Cash Reserves
This is also why I’ve been trimming some of my blue-chip winners and building up my cash position, as I mentioned in my articles. I’ve been doing this since the start of the year. Cash isn’t just for waiting around — it’s for acting with confidence when the right opportunities come up. It’s my dry powder. If the markets keep falling, I want to be ready to add to my positions gradually, carefully — not all at once. Whether it’s REITs, fixed income, or dividend stocks on sale — having cash gives me flexibility.
When markets are volatile, cash is a powerful tool. It gives you the freedom to act when others are paralyzed by fear. This isn’t about timing the market perfectly. No one can do that. It’s about being ready to take advantage of opportunities when they come up. Having cash reserves also helps me stay calm. There’s no rush to sell or panic-buy when I know I have the resources to act strategically.
Furthermore, having cash on hand allows me to take advantage of the fact that quality assets tend to go on sale during downturns. Whether it’s a stock you’ve been watching or a sector that’s temporarily out of favor, having the flexibility to add at a discounted price can pay off in the long run.
5. Staying Calm with a Long-Term Focus
So, how do I stay calm through all this? First, experience. I’ve been through previous market crashes — during COVID, 2018, the taper tantrum, and the GFC. They all seemed scary at the time, but they taught me that markets move in cycles. Things that go down don’t stay down forever. Panic selling may seem like the right move short-term, but long-term, it rarely pays off. I’ve made the mistake of selling to buy back at lower prices, but never managed to time it right.
It’s natural to feel nervous during a downturn, but what’s important is how we respond. This is why it’s so critical to have a long-term plan. If you’re investing based on fundamentals and a well-thought-out strategy, there’s no need to make emotional decisions based on short-term market movements. History has shown that, over time, markets recover, and investors who stick to their plan are often rewarded.
Secondly, I’m staying calm because I’m investing based on a strategy, not reacting to headlines. My portfolio is built for income, resilience, and long-term growth. I don’t need to worry about daily fluctuations when I know my investments are solid and my strategy is intact. This is a time to trust the process, not jump at every new headline or market shift.
Lastly, I’m keeping a long-term perspective. When you zoom out, the noise becomes quieter, and the steady compounding of dividends and reinvestment becomes clearer. That perspective helps me stay focused and not get caught up in short-term fear. This is where the real value of having a strategy comes in — it helps me stay the course even when the market seems to be in chaos.
Whether the market drops another 5% or bounces back tomorrow, I’ll adjust if needed, but I won’t abandon my plan. Of course, nothing is guaranteed, and no one knows exactly how this will play out. That’s why instead of trying to predict the headlines, I focus on managing risk, staying diversified, and positioning myself to respond — not react — as things unfold.
Conclusion
So that’s where I stand — no panic, some quiet preparation, and a focus on the bigger picture. Corrections test your temperament more than your skill. If you’ve got a plan and a resilient portfolio, this is the time to stick to it. At the same time, prepare mentally for what to do if things get worse, because in a downturn, discipline and mental strength are crucial.
Investing is a marathon, not a sprint. There will always be market fluctuations — sometimes big, sometimes small. But if you’ve built a strong portfolio based on your goals and risk tolerance, you can weather the storms. Remember, investing isn’t about avoiding downturns; it’s about staying focused on your long-term objectives and having the patience to let your investments grow.
If you found this article helpful, please like it and share it with anyone who might be stressing out about the markets. Let me know in the comments — are you buying, holding, or just watching like me? Until next time, stay steady, trust your strategy, and invest wisely.
Disclaimer: I want to make it clear that I am not a financial advisor, and nothing I say is intended to be a recommendation to buy or sell any financial instrument. Additionally, it's important to remember that there are no guarantees or certainties in trading or investing, and you should never invest money that you can't afford to lose.
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