Mind over market: 7 habits of investors who thrive during corrections

livemint.com:

Subscribe to enjoy similar stories. Market corrections are an inevitable part of the investing journey, but they don’t have to derail long-term financial goals. While it’s natural to feel anxious when stock prices are falling, savvy investors know that these times present opportunities for growth, learning, and strategic decision-making.

Here are seven ways to turn a market downturn into a chance to strengthen your portfolio and your investing mindset. When markets tumble, it’s easy to look back and convince yourself that the signs were obvious. "I knew I should have sold when valuations started looking stretched!" But the reality is, valuations can be stretched for a while and predicting the exact timing of a correction is nearly impossible, even for professional investors.

Attempting to time the market often leads to missed opportunities or locked-in losses. Focus on making forward-looking decisions based on your long-term investment plan and risk tolerance, rather than second-guessing past choices. Market downturns offer an opportunity to better understand your emotional connection with risk.

Pay attention to the investments that cause you the most anxiety and use this awareness to refine your investment approach. Also read: Falling markets are just what you needed. Here’s why If specific holdings are keeping you awake at night, they may not align with your risk tolerance.

Tailoring your portfolio to match your true risk profile will help you navigate future market volatility with greater confidence. When markets are volatile, it’s tempting to make impulsive decisions driven by fear. However, a more strategic approach is to use the correction as an opportunity for intentional rebalancing.