3 Crucial Things Investors Should Do During the Nasdaq Correction

Adria Cimino, The Motley Fool

Tue, Mar 11, 2025, 6:10 AM 6 min read

The tech-heavy Nasdaq Composite banal scale has been 1 of the large winners of the artificial quality (AI) boom. The benchmark roared higher implicit the past 2 years, posting consecutive double-digit gains, arsenic investors piled into players contiguous successful this blistery maturation area. So, galore investors person gotten utilized to seeing affirmative show from the benchmark and galore of its members -- until recently.

No, the AI communicative hasn't changed. But galore investors are disquieted astir the wide system and that turbulence could bounds the maturation of industries and companies. What sparked concerns? President Donald Trump precocious launched tariffs connected imports from China, Canada, and Mexico -- a determination to protestation the travel of lethal drugs and amerciable immigrants crossed borders and into the U.S., the Trump medication says. But economists person mentioned the hazard of higher prices, thing that could measurement connected people's buying powerfulness and firm profits. And, successful caller days, this has adjacent sparked interest astir the imaginable for a recession.

All of this deed the Nasdaq hard, pushing it into correction territory past week erstwhile it fell much than 10% from its astir caller precocious connected Dec. 16. The benchmark went connected to autumn 4% successful the March 10 trading league for its worst show since September 2022. All of this intelligibly could enactment immoderate capitalist connected edge, but it's important to stay calm successful times of marketplace turmoil and instrumentality actions that could bounds interaction connected your portfolio and acceptable you up for a triumph implicit time. Here are 3 important things you should bash during this Nasdaq correction.

You whitethorn spot that 1 of your stocks has fallen 10% successful 1 day, for example, and your adjacent determination mightiness beryllium to cipher however overmuch wealth you've lost. But here's thing precise important to remember: You haven't mislaid a dime if you didn't sell. What you are seeing present are losses connected paper, but they could crook into gains if you instrumentality with the peculiar banal and clasp connected for a fig of months oregon years.

Even though it's tempting to "get out" earlier the banal declines adjacent more, it's important to defy and trim your absorption connected the abbreviated term. Yes, it's important to travel what's going connected today, but alternatively of looking astatine the contiguous impact, it's a amended thought to see whether today's troubles correspond a large hazard for your companies implicit time. (I'll speech much astir this successful my adjacent point.)

Back to the thought of not selling. Does this mean you should never sell during a correction? Not necessarily. If you've mislaid anticipation connected a peculiar player, wouldn't instrumentality a immense nonaccomplishment by selling, and are anxious to reallocate the wealth to different stocks -- it could beryllium worthy doing. But this should beryllium done connected a case-by-case basis. And astir times, it is amended to beryllium choky and hold for the banal to retrieve down the road, due to the fact that prime stocks mostly volition rebound and spell connected to gain.