Canadian investors observing the TSX since the beginning of the September (and their portfolios), have undoubtedly noticed plenty of red. The TSX fell from it's all-time high of 15,600 to its close today of 14,576.
This is not surprising at all for a few reasons. Firstly, September is traditionally "the worst month for stocks". Statistically, September has been the poorest performing month of the year, declining 0.5% on average, and posting positive returns only 45% of the time.
One can speculate reasons for this, but I suspect it is due to light trading volumes during the summer, and investors selling positions they were planning on selling once normal work routine begins in September. It is also possible that since the fiscal year end for many mutual funds is in September, that managers are selling their losing positions.
Regardless, I do not think this is cause for concern. Although the media has been trying to link the recent correction to concrete global events (ISIS, declining oil prices, global growth warnings), the fact of the matter is that markets hit an all-time high in September. The S&P 500 has been up over 1000 days without a 10% correction, the longest period since 1987. This recent pull back is simply a round of profit taking, and the market "letting off some steam". With word of interest rate hikes on the horizon and the inundations of media reports claiming a coming crash, investors are driven to lock-in gains.
I think investors should use this recent pull back to take advantage of many companies that are currently on sale.