As I write markets around the world opened sharply lower this morning. Europe led the way and when the US markets opened the S&P and DOW were down 3.5% and 3.1%, respectively. All caused by the wave of new tariffs announced by President Trump. This global uncertainty is notoriously disliked by the investment markets. Terms like “stampede,” “market crash,” “slump” “double digit losses,” “brutal week”, “stunned investors” and articles full of red arrows leads to investor anxiety.
But before reacting in fear it is important to stop and ask: “What does this really mean for my financial future?”
Times of volatility, a roller-coaster ride for stock markets, are not unusual. It is part and parcel of investing and, despite how it “feels” in the moment, it is usually the worst time to make sudden changes to investment strategies. While it is understandable to take what is left and run for cover, staying the course is often the wisest move. There is a well-known phrase that has been flipped on its head for times like these: “Don’t just do something — stand there.” In other words, doing nothing is action in itself.
Research backs this up. Data and charts from 2003 to 2022 shows that missing just the market’s 10 best days would have reduced your investment returns by a huge 43%. Even more surprising is seven of those best days occurred during Bear Markets when most people were too afraid to stay invested. History proves that markets do not just rebound they often surge after steep falls.
Look at March 23, 2020, when “markets roared back” following the initial Covid crash. That day ranked as one of the best single-day gains in the S&P 500’s history. Even Black Monday in 1987, one of the most notorious market crashes, was followed by a strong year for equities. These examples are not rare but are reminders that patience pays off. Over the longer term the evidence is overwhelming: in any 10-year period, equities post positive returns 94% of the time and in every 20-year period they have never produced a loss.
For those investing with a long view, staying invested means staying on track. This does not mean doing nothing at all. It is about checking your financial plan with your advisor or broker, making sure it reflects your life stage, risk tolerance, and goals. Regular reviews, at least yearly, allow you to adjust thoughtfully and not reacting impulsively.
Another crucial strategy is diversification. A well-diversified portfolio spanning equities, bonds, property, alternatives, and cash can help balance risk and smooth returns over time. While no investment is risk-free, spreading your exposure is one of the most powerful ways to protect your future.
It is also important to be aware of what investing in cash is. While higher interest rates may make cash appear safer right now, inflation still erodes its value. Investments, by contrast, have the potential to outpace inflation and grow wealth in real terms over time.
The bottom line is, markets dip and while unsettling they are not new or forever. The key is to stay invested, stay informed, and stay focused on your long-term goals. Take control. Speak with a financial broker to ensure your investment strategy is robust enough to weather the storm and ready to capture the recovery that follows.
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