Chances are, you’ll lose money this year, so it’s best to plan for the years ahead ShutterstockInvestores would be wise to remember that they only lose money if they actually sell their funds or stocks.Read between the lines on the third-quarter statements from your mutual funds and you will see a hard truth written there: Your mutual funds are going to lose money in 2015. It’s not set in stone yet — and depends on the type of fund, of course — but it certainly appears that 2015 will be the worst year for stocks since 2008, with those results reflected by the average mutual fund. Never mind that stocks typically finish the year on a good note; with every major stock index down for 2015 and with market observers becoming increasingly bearish, there aren’t enough bars left in this year’s market symphony to reverse the trend. But knowing that you are facing losses and the prospect of limited improvement through year’s end is not a reason to exit the market now. Yes, the market has seen a technical “correction,” but it’s important to remember that while a decline of 10% to 15% always precedes a bear market — you can’t get to large declines without progressing through and past the small ones — most corrections don’t actually result in a bear market. It feels like a bear market, though technically it isn’t, largely because so many individual companies have crossed into grizzly territory. Nearly 25% of the stocks in the S&P 1500 Index are down 25% or more in value, meaning they crossed the line marking big trouble. But as recently as mid-May, many of those market indexes were at all-time highs, easily forgotten because recently volatility has made the decline seem worse and longer-lasting than is the case. “We’re down about 10% from the all-time record high in mid-May … but it feels worse than that to our clients and to me as well,” said Scott Wren, senior global equity strategist for the Wells Fargo Investment Institute, during an interview for my show, “MoneyLife With Chuck Jaffe.” “Retail investors, they’re sitting on their hands for the most part.” The common saw between Wren and most market observers is that when the market presents an opportunity, investors should pursue it. Today, however, investors are having a tough time determining if this is an opportunity to get out before more carnage or a chance to buy in before a rebound. That’s why investors are better off assuming now that their fund results will be down for the year, and factoring in the next move from that point, because there aren’t changes to make now that will turn a portfolio around and deliver a positive result for 2015. The most an investor can hope for now is to change their fortunes for next year and beyond. “Over the course of the last two months, most retail investors have done nothing,” Wren said. “They have not been sellers, they have not been buyers, they have simply sat on their hands and worried and probably watched the market be incredibly volatile too much.” Not making a change may be the right move, but it’s mostly accidental when an investor is frozen by indecision. “People see ‘loss’ and they want to get out, but unless you are sure that you want to get out and stay out, you’re just doing something that feels good now but that will cost you later, when you could be buying back the same things you sell today but at higher prices,” said Donald MacGregor of MacGregor-Bates Inc., a Eugene, Ore.-based firm that researches judgment and decision-making. “It looks like a loss today and it feels like a loss today, but it’s more just a fluctuation of value, especially if you are comparing your account to six or 12 months ago. It may be that the old market value was too high and this one is too low, but it only becomes a real loss if you sell.” To avoid giving into the knee-jerk response to investment pain, MacGregor and others were quick to note that the results of any individual mutual fund should not be seen in a vacuum. Instead, performance should be viewed in line with an investor’s time horizon, the purpose a fund was supposed to serve in the portfolio and more. Said MacGregor: “The inherent uncertainties in the market are high right now; the downturns and drops are very uncomfortable for many, many people. But if you look at things now and see a loss and say ‘I’m out of the game because we lost a point here or there,’ then you never belonged in the game to begin with. “Yes, most investors are losing money this year, but so long as they remember that their real results will be judged over a much longer time frame than this year — and they invest appropriately for that time horizon — this year isn’t going to be the one they remember in the end.” More from MarketWatch