Batten down the hatches, Foolish readers, because things could get rough this morning.
Volatility returned to the global market in a big way overnight with the Dow Jones shedding another 469 points, or 2.84 per cent, while the NASDAQ fell 2.94 per cent. At the same time, the FTSE 100 plunged 3.03 per cent in the UK with the Nikkei 225 also closing substantially lower.
Given that the turbulence was largely caused by weak data emerging from China, it's likely that the S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) will follow a similar trajectory, adding to the pain of yesterday's 2.1 per cent decline.
Losing money is never fun and such severe volatility like that experienced recently can force investors to make irrational decisions – such as selling into the panic. As Motley Fool columnist Morgan Housel recently wrote:
"Warren Buffett said "be greedy when others are fearful," but you really don't need to be. Keep your head on straight when others are fearful – like last week – and you'll do fine. If you can put up with a ceaseless amount of nonsense in the short run, the long run will take care of itself."
Sure, there are plenty of bargains on offer right now too that long-term investors may want to take advantage of, but it's even more vital that on days like today, you keep your emotions in check.
