In volatile times, watching your shares can feel as though you’re on an emotional roller coaster.

The temptation to sell private stock or to switch your super fund share options, might feel overpowering.

But the smart money, it seems, is on keeping your nerve and having realistic expectations.

“People need to understand that volatility is a normal part of long term investing,” says Caroline Saunders, First State Super’s senior manager of strategy and projects for investments.

“There will be volatility along the way, but markets also recover. You need to have the right mindset.”

Investing is a long game

Perhaps the kind of mindset you need is similar to billionaire Warren Buffetts’, who sees investing as a long game not a quick win.

His mantras include: “If you aren’t thinking about owning a stock for 10 years, don’t even think about owning it for 10 minutes” and “Always invest for the long term.”

“Risk is generally rewarded over the long term,” Saunders points out. “All the charts show that markets go down, but also go back up over time.”

She adds though that your tolerance for risk also depends where you are in life. “If you’re going to retire at 65 you might decide to lower your equity risk when you hit 60 because you don’t have the time to lose a whole lot of money and wait for the market to come back up.”

The main thing is to have a financial plan which, in turn, can help you to be clear about expectations and not to knee-jerk respond to fluctuations in the market.

Investing it seems should be far more sedate than riding a rollercoaster. “It’s pretty calm and quiet in here…” says Saunders of the First State Super investment team.  A comforting thought…