Therefore, you should rather focus on the factors in your control instead of getting caught up in short-term noise and making emotional decisions.
Emotional decision-making is recognised as a wealth destroyer. The irony is that both action and inaction driven by emotional responses can end up costing you dearly. Making better investment decisions starts with being attuned to the emotions we experience, and acknowledging them for what they are.
Emotional action means we buy and sell at the wrong times. Those who make emotional decisions are likely to buy and sell at the wrong times. They are likely to be sitting on cash when the market rebounds, having sold out at a low point. But markets often rally sharply and suddenly after periods of poor performance and negative returns, and you’re very likely going to miss your chance to participate in the upside when sitting on the sidelines. This may be part of the reason why investor returns tend to lag compared with those of the market.
Emotional inaction means we miss out on compounding returns.