From CNN Money: Don't panic! Selling now could hurt your retirement savings - Jun. 21, 2013
It is actually too late to strategize after a three-day selling like this week. One really needs to figure out how much one is willing to risk in this market long before the market corrections.
1. What is the asset allocation? The 100-age (or even 120-age) rule may not apply if (1) one's risk tolerance is low (which is for most folks here), (2) the overall economy is unstable.
2. What is the diversification? spreading too thin or concentrate too much is both dangerous. Indexing has its own weakness as pointed out before (e.g., it will lose as much as the broad market like the last few days).
3. Stay put for large downs (like the last few days) or large ups. This is not the time to make any actions, but it is for planning. If one has second thought about the above two items, be prepared for some future actions when the drops/jumps are over. Sell when the market recovers a bit (and vice versa).
4. Be careful to sense any long-term trend for a bull or bear market. For a long-term bear market, it is better to sell gradually and tactically than waiting it out. For the 2008 bear market, the writings were on the wall. To sell to mtigate huge losses turned out to be very prudent. For the recent sell, it is mostly over-reaction. Tactical adaptation to the ongoing market direction is an art but very crucial.
Always remember: Emotion is one's worst enemy as far as investing goes. Leave emotion at the entry of the investing arena.
Good luck for next week and future!