Market downturns upset people. We need to welcome them. Here's why. In the chart below, you can see that since 1980, there have been 22 occasions where an intra-year decline in the S&P500 exceeded 10%. That's about half the years. The last one was during 4Q 2018.
Two-thirds of the Corrections were halted short of 20%. So if you think a Correction is going to blow up into a Bear Market, that's actually a low probability event. If you're interested, there's a really great treatment of these topics here.
What's the takeaway? Don't dismiss the opportunity to establish or add to portfolio equity positions when the inevitable "Corrections" like we're having now show up. They are at least gift horses. And sometimes they turn into prize ponies.
Original 2-27-20.
