Why is there panic in financial markets and how can it be avoided?

The example of the equity market development in 2018 is revealing: while companies’ fundamental situation remains very good, share prices are plummeting. So what explanations can we find for this type of "panic" in financial markets? The presence of many "trend follower" type investors who extrapolate recent trends ; Herd behaviour among investors; The development of passive management; Investors’ use of limits for risk or losses, the result being that they are sellers and not buyers when financial asset prices fall ; The poor quality of econo mic analysis prepared by investors (which in particular mirrors developments in the past without taking into account the significant structural changes). To prevent panic in financial markets and to stop it from destroying the markets, a far greater number of active investors would be needed.