I know sometimes I sound like a broken record when I talk about market risk. But in my experience, investors start to forget about their level of risk tolerance the longer a bull market goes on. Then when the market inevitably starts to crash, they toss their plans out the door and sell in a panic.

It’s an old adage, but the market is indeed driven by fear and greed. And when fear sets in, it moves the markets a lot faster than greed. You need to be mentally prepared for this when it happens.

Lessons from the Last Crash

In all of my writing over the past month, whether here, or at Forbes, or in my weekly Utility Forecaster columns, my concerns about the impacts of coronavirus (COVID-19) on the financial markets have bled through. I didn’t think pundits were taking this seriously enough. I stressed the risk a month ago at the Orlando MoneyShow, only to have others downplay the potential impacts. Nevertheless, I have tried to remind people again and again about risk.

It’s hard to believe that the last time we saw a double-digit annual decline in the S&P 500 was 2008. That year, the index was down nearly 40%. Every sector fell that year. Even a relatively safe sector like utilities fell by 30% in 2008.

But in 2009 began the longest bull market in U.S. history. It’s not that we went all those years since without seeing a major decline in the S&P 500. There have been no annual declines at all since then. Performance like that will lull investors into complacency and overconfidence. But I have lived through the rapid, panic-driven declines. I was certain one was coming. I just didn’t know what would trigger it.

As news starting emerging in China that a highly contagious, novel new virus was spreading, I became concerned the epidemic could be the trigger. Many people have asked me how something like this impacts the markets and whether this is all just psychological. There are several factors at play.

Why Market Risk Has Spiked

First, supply chains can get interrupted because people are staying home from work. People stop traveling, so oil demand drops. Companies start warning about impacts on earnings. And it all results in fear, the strongest emotion that drives markets.

Company valuations are largely influenced by their expected earnings and earnings growth. If people aren’t going to work, or the government is implementing quarantines, or a company can’t get critical parts in their supply chain…it all impacts earnings. At this point, hundreds of companies have issued earnings warnings. Earnings will be lower across many sectors and that argues for a lower market valuation. It raises the risk of recession. And then everyone rushes for the exits in a panic.

The depth of the correction will hinge on how coronavirus continues to develop and how that impacts consumer behavior and supply chains.

If the virus continues to spread across multiple countries, especially if we see a major outbreak in the U.S., then the worst is still ahead.

A correction is a decline of at least 10% that manifests over days, weeks or months. A bear market occurs when the market falls another 10% for a total decline of 20% or more. Last week, the three main U.S. stock market indices officially entered correction territory.

Read This Story: Fear Factor: How to Ride Out the Coronavirus Panic

It’s impossible to say whether the current market swoon will extend into drops of 15% or 25% or 50%. It depends on factors we don’t yet know.

Stick to Your Plan (Or Adjust Accordingly)

In my opinion, a sustained market reversal won’t take place until there is clear news that new cases are subsiding. China seems to have gotten its cases stabilized. While the country does still have the most cases (and by far the most fatalities), new cases there have dramatically slowed. But now we are seeing major breakouts outside of China, and that is keeping the markets fearful. Once we see cases begin to stabilize globally, then the market will regain some confidence.

Until then, you must continue to execute your plan. If you are a long-term investor, this is just noise. It’s painful, but you will recover. For many, it took several years to recover from the losses in 2008.

If you were invested in an S&P 500 Index fund at the beginning of 2008, you didn’t recover until 2012. Investors near retirement, or any investor that will need their funds over the short term (< 5 years) can’t afford to take such risks. But longer term investors were back to break even by 2012, and by 2018 they had doubled their money.

That’s a powerful lesson about long-term investing. Even if you had invested in the S&P 500 just before the 2008 crash, a decade later you had doubled your money. If you sold in a panic during the decline, it’s hard to say when you might have recovered.

But painful crashes like this remind us all that we need to invest with our risk tolerance and time horizon in mind. If you were an investor in 2008, you are a dozen years closer to retirement today. Invest accordingly.

If you have a decade or more until retirement, I would slowly begin shifting money into this market. I emphasize “slowly,” simply because the downside is so hazy at this point. If a cure is announced next week, the market will rally. If things continue to get worse before they get better, we will continue to see volatility and downside risk.

Good luck out there. This is not a market for the timid, but a long horizon can be forgiving even if your timing is off a bit.

Editor’s Note: Robert Rapier has just conveyed common sense advice for profitable investing during market panics. One “crisis investment” that makes perfect sense now is gold, the classic safe haven during tumultuous times. As coronavirus panic grips Wall Street, gold prices have been soaring, with further to run.

Our colleague Dr. Stephen Leeb has pinpointed an under-the-radar play in gold that the rest of the herd is missing.

Dr. Leeb is chief investment strategist of the premium trading service, The Complete Investor. His play on the “Midas metal” could hand you exponential gains…if you act now. Click here for details.