The speed and magnitude of the equity-market decline have been record-setting. Investors have been stunned and are responding with panic.

Stock markets are showing a level of volatility that is extremely concerning to many investors. To provide insight and perspective, Kevin Barr, Head of SEI’s Investment Management Unit, and Steve Dolce, Portfolio Manager for SEI’s Small Cap Funds, answer some frequently asked questions.

There is one thing more contagious than the coronavirus; that is FEAR. Not only does fear and anxiety weaken our immune system (we physically become more susceptible to illness), it also wreaks havoc on our decision making. We all want to make thoughtful and deliberate decisions, but when we allow fear in, it takes over and may influence us to make decisions that feel right at the moment, but end up being detrimental over time.

We are bombarded by information from all sources. Scientists estimate the brain can handle three terabytes (3TB) of data. That sounds like a lot, but IBM estimates that is only 1/1,000,000 (one millionth) of the data produced daily. We can’t possibly process it all, which is why it is imperative we select what data to pay attention to.

Warren Buffett said, “Investing is simple, but not easy.” Sounds like a contradiction, but in real life simplicity has little to do with ease. Take losing weight. Very simple. Burn more calories than you take in. Not so easy!

We have our first surprise of the year: The Coronavirus. Our annual forecast always states that we will be surprised by something during the year. This is likely the first of several unexpected, unpredicted events we will experience in 2020, especially given that it is an election year.