Avoid losses at all costs: Loss aversion
What it is: The fear of loss is a stronger motivator than the pleasure of gain. As a result, people tend to avoid the risk of losing money, even if that means not reaching their goals.
How it plays out: Fear of loss can cause investors to invest too conservatively, and overreact during market volatility, selling low.
The problem: If you only invest in low-risk, low-return investments, your money may not grow enough to reach long-term goals like retirement. And selling out of fear during market downturns locks in losses, making it harder to catch up.
How to prevent it: Planning helps you focus on long-term goals, not short-term fears. If your goal is 20 years away, a loss over one month or year probably isn't all that important. Focus on your individual goals and time horizon. And monitor your investments and progress toward your goals on a set, not-too-frequent schedule—perhaps once or twice a year, or if your goals or situation change.
https://www.fidelity.com/viewpoints/personal-finance/financial-improvement
