There were so many big events competing for our attention this summer. It is important to remember that we are inherently biased to pay more attention to recent alarms than long-term trends. As an investor, if you overemphasize the news that looms the largest, you’re far more likely to damage your investments than do them any favors.

Around this time last year, COVID-19 was officially declared a global pandemic and the markets plummeted 30%. We reminded our clients and readers at that time to focus on the bigger perspective. Now, one year later, we can see the market correction in a larger context. What lessons should we learn?

We are all limited by our own behavior that may not be rational. When we are aware of our tendencies and we have the right checks in place, we can implement the necessary measures to avoid making costly mistakes.