Should You Get Out of the Market? Mistakes Investors Make During Market Drops

In this episode of the FMI Podcast, financial planners Marlana Lancaster and David Elmore discuss the fundamental principles of navigating market volatility. They address why market fluctuations are a normal, expected part of the investment cycle and explain the technical definition of a "correction". The conversation focuses on the importance of maintaining a long-term perspective, even when headlines or geopolitical events cause short-term uncertainty. The hosts share practical strategies for investors to manage their emotions, including the psychological benefits of limiting news consumption and the dangers of attempting to "time" the market. David also highlights the advantages of active management, explaining how downturns can provide opportunities to buy quality companies at under valued prices to help propel future portfolio growth.00:00 – Introduction & current market context00:27 – Geopolitical events (Iran conflict) and market impact01:05 – Why market declines like this are normal02:06 – What is a market correction?02:42 – Why downturns feel worse than they are03:08 – How advisors guide clients during volatility03:29 – Turning off the news & emotional investing03:59 – What a stock actually represents (ownership explained)05:03 – Long-term strength of companies vs short-term noise05:22 – Examples of real companies behind the market06:21 – Role of government policy vs business fundamentals07:11 – Should you get out of the market?07:24 – Why timing the market doesn’t work08:17 – Staying invested & active management strategy08:44 – Buying opportunities during downturns (“on sale”)09:04 – Dollar-cost averaging during volatility09:24 – Limiting news consumption09:42 – How often to check your portfolio10:46 – Active management example (oil, Exxon, profits)12:03 – The “brick through the window” analogy13:09 – Recap: why you can’t time the market13:43 – Missing recovery days and impact on returns14:06 – Final thoughts & closing