Big selloffs often reflect market mechanics, not broken long-term theses: Sharp drops in any crowded, liquid area (equities, tech, commodities) can spill into other assets via de-risking, liquidity selling, and USD/rates repricing— without changing the long-term fundamentals.
Diversification doesn’t mean zero volatility: In stress, correlations rise and even “defensive” holdings can wobble. If volatility forces decisions, the issue is usually sizing and process, not whether you picked the “wrong” asset class.
The biggest risk is turning short-term volatility into a permanent decision: Successful long-term investors rebalance exposure, not emotions. A bad week tests discipline – it doesn’t require perfect timing…
