When markets become volatile, the biggest challenge often is not finding the right investment. It is staying committed to a well-thought-out investment plan.
When markets are rising steadily, it is easy to feel confident about investing. But when share prices fall, interest rates remain elevated or geopolitical tensions dominate the headlines, even experienced investors may begin to question their decisions.
While every market downturn feels different, uncertainty itself is not unusual. Markets have always gone through cycles of optimism and pessimism, and periods of volatility are part of long-term investing.
The real test for investors is not whether they can predict the market’s next move. It is whether they can remain disciplined when emotions begin to take over.
At the InsureXpo by CIMB 2026, we spoke with Diana Teo, Team Lead, Equities at CIMB Chief Investment Office, about how investors can build better investing habits that hold up during uncertain markets.
Uncertainty Is Part Of Investing
Every year seems to bring a new reason for investors to worry.
One year, it may be inflation. Next, it could be interest rate decisions by central banks. Add geopolitical conflicts, slowing economic growth and changing government policies, and it is understandable that many investors feel uncertain about what comes next.
Instead of trying to predict the impact of every headline, Diana believes investors should focus on building portfolios that are prepared for different market conditions.
Markets do not move in straight lines. Some sectors outperform while others struggle, and different asset classes often respond differently to changes in the economy. Rather than positioning a portfolio for one specific outcome, investors may be better served by building one that can weather a range of scenarios.
Volatility Is Uncomfortable, But It Is Not Unusual
Watching the value of an investment portfolio fluctuate is rarely comfortable. However, volatility is one of the defining characteristics of financial markets.
For long-term investors, market declines have also historically created opportunities to accumulate quality investments at lower prices. While no one knows exactly when markets will recover, downturns have often been followed by periods of recovery.
This does not mean every market correction should automatically be treated as a buying opportunity. Rather, it shows why investors should expect volatility instead of viewing it as something unusual.
Read Also: Are You Financially Fit? 5 Signs You May Be Less Prepared Than You Think
Why Emotions Can Become An Investor’s Biggest Obstacle
Most investors already understand the basic principles of long-term investing: buy quality investments, stay diversified and avoid making emotional decisions. The difficulty comes when markets fall sharply and these principles become much harder to follow.
Behavioural finance, which studies how psychology influences financial decisions, shows that people generally feel the pain of losses more strongly than the satisfaction of gains. This can lead investors to sell after prices have already fallen or chase investments that have recently become popular.
According to Diana, one useful way to distinguish between a rational investment decision and an emotional one is to ask yourself:
“If markets were calm today, would I still make the same decision?”
If the answer is no, it may be worth taking a step back before acting.
Have A Plan Before Markets Fall
Much like following a fitness programme, investing works best when there is a plan in place before challenges arise.
An investment plan provides structure when emotions are running high. Rather than deciding what to do in the middle of a market correction, investors can rely on a framework that already takes into account their financial goals, investment horizon and tolerance for risk.
The plan may also include guidelines on diversification, regular portfolio reviews and when to rebalance investments if allocations drift too far from their original targets. Making these decisions in advance can reduce the temptation to react impulsively to short-term market movements.
Diversification Remains One Of The Simplest Ways To Manage Risk
Most investors are familiar with the saying, “Don’t put all your eggs in one basket.”
Yet many portfolios remain heavily concentrated in a handful of stocks, a single market or one investment theme.
Diversification means spreading investments across different asset classes, industries and geographical regions so that the portfolio is less dependent on any single area performing well.
For example, equities may provide long-term growth potential, while bonds can generate income and help reduce overall portfolio volatility. Assets such as gold are also commonly used as a hedge against geopolitical uncertainty and periods of market stress.
Diversification cannot eliminate investment risk, but it can make a portfolio more resilient when different parts of the market perform differently.
Don’t Let Headlines Distract You From Long-Term Goals
Investors today have access to more information than ever before. News alerts, market commentary and social media updates arrive almost continuously, making it tempting to react to every development.
However, long-term financial goals, whether retirement planning, funding a child’s education or building long-term wealth, typically do not change every time the market moves.
Rather than monitoring their portfolios daily, Diana suggests that investors review their investments periodically to ensure they remain aligned with their long-term objectives and an appropriate level of risk. This shifts the focus away from short-term market noise and back towards the purpose of investing in the first place.
Three Simple Investing Health Checks
Just as regular health screenings help identify potential issues early, investors can benefit from reviewing a few key areas of their portfolio each year.
The first is portfolio allocation. Is the portfolio diversified across different asset classes, markets and sources of return, or has it become overly concentrated?
The second is bond duration. For investors who own bonds, are those holdings still appropriate if interest rates remain higher for longer?
The final check is perhaps the most important: behaviour. During recent periods of volatility, were investment decisions driven by a long-term strategy, or by fear and market headlines?
These questions may reveal more about future investment outcomes than trying to predict where markets will move next.
Consistency Matters More Than Perfect Market Timing
Successful investing rarely depends on making the perfect decision every time. Instead, it is often the result of following a sensible investment strategy consistently through both good and difficult markets.
Market uncertainty will never disappear. However, disciplined investing can help investors avoid allowing temporary emotions to derail their long-term financial goals. Like physical fitness, investing is less about finding shortcuts and more about developing habits that can be maintained over many years.
Read Also: InsureXpo 2026 By CIMB Shows Insurance Isn’t Just for Adults Anymore
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