Market Volatility FAQ: What Our Readers Asked Us

Editor's note: Read the latest on how the coronavirus is rattling the markets and what investors can do to navigate it.

We asked readers what coverage they wanted to see from us during this time of coronavirus-caused market volatility. Here are the most commonly asked questions that we received, answered by our analysts and investing specialists. Have other questions? Let us know.

What should my strategy be right now and when things turn around? Right now, you should stay invested. Our mantra at Morningstar is investing for the long term; the reasons for this approach are explained by the president and chief investment officer of Morningstar Investment Management, Daniel Needham. He explains why you should view volatility as an opportunity, calling to Warren Buffett's investment principles. We believe this strategy is what will work for most investors in this time of uncertainty.

Looking into the future, we think the scope of the shutdown is unlikely to affect the economy in the long term. Equity analysts Karen Andersen and Preston Caldwell have built a detailed model to assess the coronavirus' long-term impact on the economy; they note that about 70% of gross domestic product is from businesses that are exempt from stay-at-home orders, and about half of the businesses that aren't exempt can continue with remote operations. Congress' stimulus bill will also help Americans get through the pandemic.

How should I be thinking about the situation if I'm already/almost in retirement? I don't want to run out of money. In this time of volatility, how can you make the best of it? Our director of personal finance Christine Benz provides comprehensive guides on steps you should take, broken out for retirees and pre-retirees. Some of the steps include tethering your withdrawal rate to your portfolio balance, identifying tax-saving opportunities, and re-evaluating your long-term asset allocation. Additional considerations include the stimulus package's impact on required minimum distributions, an opportunity to convert to a Roth IRA, and sources for emergency cash.

When's the right time to rebalance? It's a good time to assess your asset allocation if you have a buy-and-hold portfolio and have not rebalanced. Manager research analysts Adam Millson and Jason Kephart explain that in bear markets, a buy-and-hold investor's equity allocation can shrink far faster than bond allocations. Rebalancing back to the target equity allocation during this time of volatility will help portfolios rebound faster, and our analysts walk you through historical scenarios that prove this to be true.

How long will this last? The underlying volatility in the markets is caused by the pandemic; thus, how long this will last will depend on the solution we find to address that underlying issue. We assume that current social distancing efforts will begin to reduce the number of cases by the end of May and we will be able to begin lifting restrictions in June and July. We anticipate waves of drug treatments for COVID-19: Gilead's remdesivir in the summer, targeted antibodies by the end of the year, and ultimately a vaccine in 2021. Meanwhile, our columnist John Rekenthaler explores the market stages we have experienced since the sell-off.

How should I be thinking about bonds right now? No corner of the stock market was safe from the hard-hit volatility, and even bond markets, the traditional safe havens, suffered surprising losses. Liquidity strains have impacted all parts of the bond market. Some fared worse: Credit markets and all other bonds not backed by a developed-markets government were hit the hardest. But, as manager research analysts Miriam Sjoblom and Eric Jacobson point out, the unprecedented response by the Federal Reserve and other policymakers should provide much-needed support to the higher-quality segments of the bond market. Level-headed strategies should be on the mend, and there are signs that the Fed's measures are working.