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One of the basic principles of investing is to focus on the long term and ignore the short-term volatility, or as it is often called, the noise. There is no doubt of the importance of the concept, but it offers little comfort when the noise wipes out a significant portion of the value of ones portfolio. From the September high to the recent low, the S&P 500 dropped 18% and even after the recent rally is still down 13%. I wrote last month that if the market did break down from its trading range it could "go south in a hurry", but I was in no way prepared for an 11% decline within two weeks...(continue reading By The Way - January 2019)
