How is money being lost? I buy 100 shares of company X for $10 ($1000). The market tanks and now I can buy 100 shares of company X for $1 ($100). You could say that I now have 200 shares of the company that are worth $200 (a $900 loss), but the market will recover (it always has in the past) so when those shares are again worth $10 I can sell them for $2000. The only way people could lose money is if they sell when the market is down, but you don't sell when the market is down - that is when you use cash or other investments that are not subject to market fluctuations.