The best way forward amidst the stock market turmoil caused by Russia's invasion of Ukraine is to make calm decisions.

The U.S. economy is experiencing repercussions from the Biden Administration's announcement of harsh economic sanctions on Russia for its invasion of Ukraine on Thursday, particularly in the stock market.

On Thursday, after experiencing a decline earlier in the day, stock indexes in the U.S. rose, with the Dow Jones Industrial Average up 3.17%, the S&P 500 up 2.09% and the NASDAQ Composite index up 1.77% in the last five days.

The stock market swings are not something to panic about, as real-world events can make stock prices more volatile in the short-term, but in the long run they have less impact on your investments.

Since 1926, the S&P 500 has averaged an annualized return of 10.49%, which is significantly higher than the historical returns of bonds, which have averaged 5 to 6% over the same period.

The stock market crash of 2020, caused by the pandemic, resulted in the largest one-day loss in Dow Jones history. However, the market recovered by April of 2020.

Michael Wagner, co-founder of Omnia Family Wealth, stated that they have more experience with geopolitical issues, such as the Iraq War and Russia's annexation of Crimea, as seen in the situation with Ukraine.

The longer you plan to invest, the less you should worry about short-term events, as alarming as they might be, since no one knows for sure how the stock market will play out.

In February 2022, will you be reflecting on our performance thirty years from now? Wagner inquires.

Warren Buffett, a long-term investing expert, stated in a 2017 letter to shareholders that unsettling events can cause irrational decisions when emotions are high. He explained that even if one's borrowings are small and their positions are not immediately threatened by the plunging market, their mind may become rattled by scary headlines and breathless commentary. As a result, an unsettled mind will not make good decisions.

The value of your portfolio is a numerical representation, not actual cash that you can withdraw at this moment.

According to Wagner, unrealized gains and losses are intentionally labeled as such until they are officially realized through the sell button. Once sold, the loss is finalized, and the perspective returns to the initial point.

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