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The importance of being brave in this ASX bear market

It’s a tough time for all ASX investors right now. Chances are that if you have a portfolio of ASX shares, it’s in the red as we speak. It can be very disheartening thinking about how much better your cash would have been in the bank rather than the markets today – believe me, I know!

But fortunately, or unfortunately, that’s what investing is all about. None of us could have predicted what has happened. Rewind to January and it seemed as though we were on track for another bumper year of ASX gains. We have to take the good with the bad when it comes to shares – there’s no alternative.

So right now, with the S&P/ASX 200 Index (ASX: XJO) having lost around 30% of its value since mid-February and firmly in bear market territory, I think it’s an important time to be brave.

Be brave in resisting the urge to ‘cut your losses’ and just get out of the market (it’s normal to feel this way, no matter how irrational).

Be brave in putting your money into a highly volatile market that no one knows where it will be next week, let alone next month or next year.

I myself have tried to follow this path. I’ve topped up on some of my favourite ASX shares in recent weeks, including WAM Global Ltd (ASX: WGB), MFF Capital Investments Ltd (ASX: MFF), Pact Group Holdings Ltd (ASX: PGH) and Washington H. Soul Pattinson & Co. Ltd (ASX: SOL).

I’ve even opened up some new positions, including in Ramsay Health Care Limited (ASX: RHC) and WAM Research Limited (ASX: WAX), as well as also dabbling in some quality ETFs that have lost a lot of value, like the SPDR S&P Global Dividend Fund (ASX: WDIV).

I even picked up some Uber Technologies Inc (NASDAQ: UBER) shares.

But it wasn’t easy doing this. I was scared that the shares would fall significantly further than my purchase price (which many have). I was scared that some of these companies might be affected by the coronavirus in ways that I didn’t yet know (which they still might be). But there are always fears and doubts swirling in this kind of market. And there is no flashing signal that marks the best time to buy shares.

At the bottom of the GFC market crash in early 2009, there were newspaper headlines warning of a Dow Jones Industrial Average of 5,000 (it bottomed at around 7,000).

As the old saying goes, it’s always darkest before the dawn.

And when the dawn comes, it’s too late to be brave!

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Sebastian Bowen owns shares of Magellan Flagship Fund Ltd, Pact Group Holdings Limited, Ramsay Health Care Limited, SPDR S&P Global Dividend Fund, Uber Technologies, WAM Research Limited, WAMGLOBAL FPO, and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia's parent company Motley Fool Holdings Inc. recommends Uber Technologies. The Motley Fool Australia owns shares of and has recommended Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has recommended Ramsay Health Care Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.