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China-led market volatility has roiled global asset markets, and potentially shaken investors faith in the current bull market. Loss averse investors heading to the sidelines should understand the performance of domestic equities over rolling 10 and 20-yr time periods to avoid missing future gains. This article borrows from recent quotes from famed investor Warren Buffett and stock price information from Nobel laureate Robert Shiller. Market optimism is falling with global share prices, but I want to offer some respite to Seeking Alpha readers. Stocks will go higher. I can not tell you about today, this week, this month, or even the rest of this year. However, as you extend your investment horizon, stocks almost invariably perform. In an August 10th interview on CNBC, Warren Buffett, the famed investor and chairman and CEO of Berkshire Hathaway ( BRK.A , BRK.B ) stated: ” Stocks are going to be higher, and perhaps a lot higher 10 years from now, 20 years for now .” To test his time horizon, I pulled from the long time series of online data that Robert Shiller uses to calculate his famed Cyclically Adjusted Price Earnings (NYSEARCA: CAPE ) Ratio. Below I show cumulative ten-year total returns for the S&P 500 (NYSEARCA: SPY ) and predecessor indices from the Shiller data dating back to 1900. The blue lines are cumulative price returns and the pink lines include dividends. Periods of negative ten year cumulative returns are very limited. The presence of negative ten-year cumulative periods overlapping the tech bubble collapse and the global financial crisis may make myopic investors unduly concerned about the long-run prospects of domestic equities. (click to enlarge) Buffett’s quote first focused on ten-year periods, but expanding a holding period to twenty-years would have only yielded negative total returns (including dividends) in a period that overlapped the 1929 stock market crash and World War II. (click to enlarge) In this interview, Buffett went further stating that “my game is to own decent businesses and decent prices and you are going to make a lot of money over time if you do it, but I think the ability of people to dance in and out of markets is quite limited and in my case is zero.” This statement is consistent with the s tudies linking Buffett’s performance to low volatility equities – he buys businesses that perform through multiple business cycles. Long-time readers know that I am not an unabashed bull, cautioning against the prospect of subnormal returns and increased volatility in my semi-annual market outlook . I also demonstrated earlier this year that equity multiples appeared stretched , including a look at the aforementioned Shiller data. However, if you are uncertain what to do with your domestic stock holdings in these times of heightened volatility, plan to buy high quality businesses on weakness and be prepared to hold these investments for long time periods. If history is a guide, you are very likely to come out a winner. Disclaimer : My articles may contain statements and projections that are forward-looking in nature, and therefore inherently subject to numerous risks, uncertainties and assumptions. While my articles focus on generating long-term risk-adjusted returns, investment decisions necessarily involve the risk of loss of principal. Individual investor circumstances vary significantly, and information gleaned from my articles should be applied to your own unique investment situation, objectives, risk tolerance, and investment horizon. Disclosure: I am/we are long SPY. (More…) I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.