2018 has been one of the most volatile in recent history.

In January 2018, the Dow Jones sank from a high of 26,616 to a low of 23,360, only to rebound and plunge again.  Then it rallied to an all-time high of 26,951 before plunging to 24,122.

We saw similar volatility in the tech-heavy NASDAQ, the S&P 500, and Russell 2000.

All thanks to a mountain of worry.

Some believe the Federal Reserve made a mistake raising rates too quickly, which could make borrowing much more expensive. Even though inflation is only 2.1%, the Fed is planning several more hikes over the next year, which may be far too fast.

The end of quantitative easing is looming in Europe.  U.S. corporate earnings growth may be slowing.  U.S. sanctions on Iran are again in place.  And then of course, the trade war between China and the U.S. is a cause for concern.

However, the biggest culprit has been the fear over the midterm elections.

There’s uncertainty on whether or not Congress will change hands.  In fact, there was growing fear that if the Democrats won the midterm elections, we’d see a quick rollback of the well-received tax cut for both companies and individuals and more regulations on companies.

That – many fear – would put an immediate halt to economic progress.

Of course, such uncertainty has created extreme fear in the market.  Many investors panicked and sold quality stocks.  However, that’s the worst thing you can do.  The best strategy in a pullback is to wait out the panic, and hold for the eventual rebound.

We’re in the middle of exceptional economic growth.

Over the past week, the U.S. GDP came in better than expected at 3.5%.  Then, the Bureau of Labor Statistics reported another 250,000 jobs in October 2018.  That was much higher than projections for just 190,000, as we reported the other day.

"The job market is doing remarkably well, particularly this late in the expansion," said Jim Baird, partner and chief investment officer for Plante Moran Financial Advisors, as quoted by CNBC. "This report adds yet another data point to a narrative that has been positive for the labor market this year. Little seems to stand in the way of the economy finishing 2018 out on solid footing."

In addition, the number of employed Americans has never been higher at 156,562,000.

Granted, unemployment held at 3.7%, but that is the lowest rate since 1969.

Volatility will come and go.  Just don’t let it chase you out of quality stocks in the market.

Stay tuned to The Cheap Investor for more on market developments.