There is one thing that every new investor must know.
And that is: market volatility is part and parcel of investing.
Experienced investors understand that volatility does not just mean risk; it can also create opportunities.
Here’s how you can invest calmly even during turbulent markets.
Why Market Volatility Feels So Stressful
When markets are swinging, the headlines scream “crisis” and amplify the fear.
As we are wired to react more strongly to losses than profits, the pain of potentially losing money may cause panic.
Some investors may see these short-term losses as signs of deeper problems.
They end up selling when markets fall and buying when they rise – all from an emotional overreaction to price movements.
It is crucial to recognise how emotional biases can influence decisions, and how best to manage them.
This way, you can stay calm and keep a disciplined approach when investing.
Step One: Focus on the Business, Not the Price
Unlike stock prices, business fundamentals change slowly.
Instead of reacting to daily price swings, evaluate the company’s earnings, cash flow, and balance sheet strength.
Take Singapore Exchange Limited (SGX: S68), or SGX, as a recent example.
On 27 February 2026, the stock traded at S$18.20, supported by a massive 57% operating profit margin.
During the geopolitical tensions of early March, the price dipped to S$17.10 (4 March 2026).
Yet, the business actually strengthened; the market volatility drove record derivatives trading volumes, pushing the price back to S$18.25 by 10 March.
When you focus on the “moat”—SGX’s position as Singapore’s sole exchange – it becomes clear that the very volatility that scares some investors is actually a revenue driver for the company.
High-quality companies are often the most resilient because their underlying engine hasn’t stalled, even if the price flickers.
Step Two: Maintain a Long-Term Investment Plan
Successful investors have clear strategies; they don’t keep entering and exiting the market at the “right moment”.
Building a long-term investment plan helps investors stay focused on their goals.
First, you need to identify your investment horizon.
This helps to determine the type of investment that will be most suitable to reach your goals.
Next, know your risk tolerance, and how much price fluctuation you are comfortable with.
If your goal is to generate income, consider including dividend-paying stocks such as SGX and Parkway Life REIT (SGX: C2PU).
These companies have a long track record of paying consistent dividends over many years, even during dips in the market, like the COVID-19 pandemic.
On the flip side, if you are looking to capture long-term capital appreciation, focus on companies with scalable platforms like iFAST Corporation (SGX: AIY), which tend to reinvest their success back into the business.
Step Three: Use Volatility to Your Advantage
Market volatility is also an opportunity for investors.
When share prices fall temporarily during market pullbacks, it creates potential buying opportunities at more attractive prices.
Take DBS Group Holdings (SGX: D05) for example.
Singapore’s largest bank is not immune to price swings.
During the 2020 pandemic, DBS shares plummeted from S$24.05 on 17 January 2020 to a low of S$16.30 on 2 April 2020.
Yet, investors who didn’t panic saw the stock recover to around S$23 by year-end before marching towards new all-time highs.
Those who had invested then would be thrilled to see DBS prices double to highs of over S$50 in the past year.
Step Four: Keep Your Portfolio Balanced
A balanced and diversified portfolio usually comprises a mixture of growth stocks, income-generating stocks, defensive stocks, and maybe one or two real estate investment trusts (REITs).
For example, if you have about S$10,000 to invest, a diversified portfolio might look like this:
Banking: 100 shares of DBS (S$5,540)
Income: 100 shares of SGX (S$1833)
Growth: 100 shares of iFast ($891)
Consumer Defensive: 300 shares of Sheng Siong Group (SGX: OV8) (S$771)
REIT: 300 shares of Parkway Life (S$1197)
It is important to keep an eye on your allocation, as some might grow to dominate your portfolio over time.
Trimming it regularly can help protect the long-term stability of your investments.
Common Mistakes Investors Make During Volatile Markets
Making emotional decisions, such as panic selling during market corrections due to fear, can prove to be costly.
Some investors try to time the market instead of sticking to disciplined investment strategies.
This may result in overtrading either out of fear or boredom.
Buying and selling frequently can cause investors to erode their long-term returns through poorly timed exits and rack up significant transaction costs that eat into capital.
Some may also be guilty of following the herd, reacting to the market sentiment instead of looking at business fundamentals.
Get Smart: Stay Disciplined Even During Market Volatility
While we cannot control market movements, we can control how we react to them.
Volatility is uncomfortable, but inevitable.
Experienced investors don’t overreact; they expect volatility as part of the investing process.
Many use strategies such as Dollar-Cost Averaging (DCA) – investing fixed sums at regular intervals regardless of price.
This approach builds wealth steadily and prevents impulsive capital allocation during extreme swings.
Keep the focus on a company’s intrinsic value rather than its fluctuating ticker price, and stay the course during turbulent periods.
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Disclosure: Wenting A. does not own any stock mentioned.
