President Trump’s escalating tariff wars continue to send panic through all sectors of the financial markets.

This has resulted in investors making some bad financial decisions. Whether it’s panic selling, hiding out in cash or trading frantically during volatile markets, investors tend to make these types of mistakes that will hurt them in the long-term.

Of course, when markets fall sharply, it’s only natural that investors become concerned and think about moving money to less risky investments (such as cash options) with a plan to switch back later.

To that point, cash has become a hot option among investors.

However, while holding or moving to cash might feel good mentally and help avoid short-term stock market volatility, it’s unlikely to be wise over the long haul.

Why? As one financial advisor told me: “The strong rebound in stock prices that often follows a market downturn should underscore how bailing out can cost you when the market reverses direction.”

Additionally, cash has historically delivered lower returns than stocks over the long term. Holding on to more cash than you need — rather than investing it — raises the risk that you may not achieve your investing goals.

For investors with a long-term perspective, short-term market stress is a distraction that is better off ignored, financial advisors say. While the market could be in for a bumpy ride over the next few weeks, it’s best to stay the course and avoid making any major portfolio changes based on the latest news, they say.

For more advice to help you make smart money decisions, check out CNBC's Financial Advisor Hub and Personal Finance section.