Case #1: On January 10, 2011, a small consumer goods company stock jumped +8.1% on trading volume more than 40 times its average in recent weeks. There wasn’t a single bit of company or industry news that caused this stock to move so dramatically. It was, in fact, caused by a typo and some clearly unsophisticated investors.

The prior Friday, CNBC Mad Money’s host Jim Cramer made a recommendation for a completely unrelated stock while on the air. Summaries of Cramer’s show are then typed up and posted to cnbc.com. During this transcription, cnbc.com mistakenly attributed the incorrect stock symbol to Cramer’s pick. Come Monday morning, a sizeable number of investors who saw the cnbc.com article were ready to snap up shares, but they didn’t bother to do even the most basic research on the company (e.g., verify that the stock symbol actually belonged to the recommended company). Cramer said “Buy!”, so they were going to buy. Unfortunately, they were buying the wrong stock.

Case #2: Todd Sullivan manages an investment partnership, but also provides stock research to investors through an online subscription service. Mid-day on January 14, 2011, he emailed an alert to his subscribers that he had sold half of his position in a stock that had quadrupled in price since he first bought it. He told subscribers that he still thought the company had a good outlook, but he felt it prudent to take some of his big gain off the table.

You can probably guess what many of his subscribers did next. Yes, they dumped their stock as fast as they could. Other investors unaware of the sell alert likely panicked, assuming that there was some bad news out on the company, and sold right along with them. At the end of the day, the stock was down -14%.

While each of these cases came about for different reasons, there are a few notable similarities.  First, there are a lot of investors who will trade urgently and without thinking just because they heard that someone else was doing the same. Second, big changes in price can occur due to trigger events that have nothing to do with what is occurring at the actual company.

Markets can be crazy. In these examples, they went crazy one stock at a time. In other periods, the entire market can seem crazy, with hair-trigger traders filled with emotion. We need to accept that this happens and understand that it is no reason to run from the market. What matters are not these daily gyrations, but the long-term opportunities that the markets provide to grow your wealth. Let the other guys make the silly mistakes while you stay focused on your ultimate goals.