Significant market corrections and the ripple effect on your portfolio

Investors always worry about the next major market correction and what could trigger it. While we often contemplate risks tied to specific events that could lead to a significant market downturn, the truth is that the events capable of causing such a correction are largely unknown. The worldwide crisis and the aftermath of covid-19 pandemic was surely never on the radar. The rationale for this: it was a low-probability event with high short-term impact. Conversely, the much-anticipated risks are usually high-probability events with lower impact.