This is probably the worst thing any investor could do when faced with what's going on in the market these days. No doubt it's painful for most investors but to panic and do something rash is the wrong thing to do.
Remember all those reasons you bought shares of those companies in the first place. If those reasons escape your memory, look back on your notes (smart investors do that). I like to buy the stock of companies that increase their revenues, earnings and dividends over an extended period of years. So when my stocks get taken down, as many of them have lately, I simply recheck those fundamentals that got me into the stocks. If the fundamentals of the companies I own are still intact, I simply relax. Take a nap. Or buy even more.
I have to keep in mind that I'm buying companies with solid fundamentals and great management teams. Those companies always find a way to increase their revenues and earnings and understand the importance of maintaining and increasing the company's dividend. Most of these management teams have been through difficult times before and they have been successful in managing these difficult environment and even benefiting from any economic shifts. And then they usually increase their dividend as they've done before.
I expect that most of what's going on this week is simply the realization by investors and traders that the Chinese government has been pumping out fake economic data for years in an attempt to control their financial markets. As the truth starts to come to light the Chinese are beginning to find out that they can't control capitalism like they control their political system. This incompetency is causing second and third order affects in the world markets but in the end those markets may undermine the political system in China.
In the future some of our best Business Schools and some of our best MBA students will be studying these events for any lessons to be gained. Maybe the Political Science and History Departments should be studying these events too.