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Think of the market's wild gyrations in recent days as a test of your investing nerves.

If you watched the havoc unfold with zen-like peace, congratulations. Your asset mix is appropriate to your tolerance for risk.

But if you found your pulse racing, you should regard the recent wobble as a wake-up call. Take a few minutes to re-assess whether your current mix of investments is still on target.

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A good place to start is by checking your expectations against what the pros consider reasonable.

Aggressive Canadian investors with portfolios composed primarily of domestic and foreign stocks can expect average gross returns over the long term of 6 per cent a year before fees, according to the mid-2017 guidelines developed by the Financial Planning Standards Council, a professional body for financial planners.

In contrast, conservative investors with bond-heavy portfolios should plan for returns of 4.5 per cent a year before fees, according to FPSC. The lower long-term returns reflect the greater stability of conservative portfolios. They aren't as exposed to stock market swoops and falls as their more aggressive cousins.

Is the extra return from being aggressive a good deal? The answer depends on your overall financial situation and your age.

If you're under 45, you have many years to recover from any future tumble in stock prices, and deciding to embrace more volatility may justify itself with higher expected returns. But if you're older – and especially if you're over 55 – it's important to consider what a downbeat period for stock returns might mean.

These sour patches come along more regularly than most people realize. Despite all the rhetoric about holding stocks for the long term, the total payoff from doing so can swing dramatically, even for patient investors.

Consider what would have happened if you had invested $10,000 in the iShares Core S&P/TSX Capped Composite Index ETF – basically, a plain-vanilla way to bet on the broad Canadian stock market – exactly 15 years ago, in 2003.

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Five years later, in 2008, assuming you had re-invested your dividends, you would have nearly $22,000, more than doubling your original stake.

But the next five years would have been miserable. An investor who started with $10,000 in February, 2008, and invested it in exactly the same manner would have slightly less than $10,700 in 2013 – barely any growth at all.

If a third investor began with $10,000 in February, 2013, and held it until now, she would have an experience somewhere between her two earlier counterparts. Her $10,000 would now be worth about $14,400, a solid but not overwhelming gain.

Wide differences in returns can persist for even longer periods. Especially if you go a step further and factor in the effects of inflation on the buying power of your profits, the disparity from one stretch to another can be eye-popping.

Looking back over the past several decades, the luckiest investors were those who diligently held the benchmark S&P 500 index in the United States for 15 years beginning in either 1950 or 1985. These fortunate folks reaped total real returns – that is, after-inflation rewards – of more than 15 per cent a year during those periods, according to Jill Mislinski of Advisor Perspectives Inc. They increased their real wealth eight times over.

On the other hand, the unlucky investor who followed the same strategy but started in 1968 would have wound up losing more than 2 per cent a year of his real wealth over the next 15 years. This poor soul would have done exactly the same thing as the big winners, for exactly the same holding period, but experienced vastly different results.

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As these numbers suggest, you should look at both good and bad cases for the coming few years, and consider what they might mean for you. If a mediocre decade for stocks would seriously disrupt your retirement plans, maybe it's time to start saving more.

The worst that can happen is that markets deliver delightful results. If so, you can retire earlier or better than you thought.

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