Staying Calm When Investing Feels Anything but Calm

One of the most common questions we hear when markets become unsettled is, “Should we be doing something?” It is an understandable question. When headlines are alarming and uncertainty feels unavoidable, taking action can feel more comfortable than standing still. But in our experience, some of the most damaging investment decisions are made when short-term fear overrides a thoughtful, long-term plan.

That is why David Booth’s new book, Stay Calm: Learn to Embrace Uncertainty in Investing and Life, resonated with us. Booth, the founder and chairman of Dimensional Fund Advisors, writes about investing in a way that is both practical and deeply human: we cannot control what happens next, but we can control how we respond. 

Why This Message Feels So Important

In explaining why he wrote the book, Booth shares the story of his parents, who grew up during the Great Depression. Their experience left them skeptical of the stock market and convinced that investing was primarily for insiders. After his father died, the family found a significant amount of cash in a safe deposit box. Booth later calculated how much it might have grown had it been invested decades earlier. We do not hear judgment in that story. We hear empathy—and a reminder that our experiences with money can shape our decisions for a lifetime.

All of us bring a personal history to investing. We may remember a market crash, a job loss, a family hardship, or a time when money felt uncertain. Those experiences matter. Good planning does not ask us to ignore them; it helps us understand them, so they do not quietly take control of our future decisions.

A Better Way to Think About Investing

To us, one of the most reassuring ideas in Stay Calm is that successful investing does not require us to predict the future. We do not need to identify every market peak, avoid every decline, or find the next hot investment. Instead, we can rely on a few durable principles supported by decades of academic research:

• Diversification across markets and asset classes
• Maintaining discipline during periods of volatility
• Focusing on what you can control
• Avoiding emotional decisions driven by fear or greed
• Remaining patient and committed to a long-term plan

Markets absorb information quickly, which makes consistently outguessing them extraordinarily difficult. That can be frustrating, but it can also be freeing. Our job is not to know exactly what will happen next. Our job is to build a plan suited to our goals, accept that uncertainty comes with investing, and remain disciplined when that plan is tested.

Uncertainty Is Part of the Opportunity

Most of us would prefer certainty, especially when our savings and future plans are involved. But Booth makes an important point: uncertainty is not a flaw in the market. It is part of the reason investors have the opportunity to earn a return. If outcomes were guaranteed, there would be little reward for accepting risk.

This idea closely reflects how we work with clients at J. F. Williams Co., Inc. We know that market declines, recessions, elections, geopolitical events, and unexpected headlines can be uncomfortable. Our role is not to promise that those periods will disappear. It is to help clients prepare for them, keep them in perspective, and avoid allowing a temporary moment to permanently alter a sound long-term strategy.

We often come back to a simple thought: the goal is not to stay calm because markets are calm. The goal is to stay calm because they are not.

Remembering What the Money Is For

Another reason the book feels personal is its focus on “true wealth.” Financial success is not simply a larger account balance. It is the freedom to make choices, care for the people we love, spend time in meaningful ways, and pursue a life with purpose.

We believe investments are tools. They help support the life we want to live, but they are not the life itself. Remembering that can make it easier to look beyond today’s headlines and reconnect with the reasons we invested in the first place.

What We Hope Investors Remember

When markets become volatile, doing nothing can feel like neglect. Often, however, the most valuable action is to revisit the plan: Has your life changed? Have your goals changed? Has your need for cash changed? If the answers have not changed, the investment strategy may not need to change either.

Stay focused on what matters to you. Trust the planning process. Remember why your portfolio was built the way it was. And when uncertainty makes you feel that you must react immediately, give yourself permission to pause and talk it through.

That, to us, is the heart of Booth’s message: staying calm is not passive. It is a deliberate decision to let a well-built plan—and the markets—do their work overtime.

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Sources

• David Booth, “Why I Wrote Stay Calm”
• Stay Calm Investing

Investing involves risk, including possible loss of principal. Diversification does not guarantee a profit or protect against a loss. This article is for educational purposes and is not individualized investment advice.

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