Donald Trump is certainly back in The White House with a bang. Since his inauguration, stock markets have been extremely volatile, particularly since his announcement of tariffs on 2nd April. Uncertainty has been the order of the day and even the most experienced investors have been quite rattled by the huge daily swings.
There is a sense that our wealth is tied to the whims of one man. However, this is not the case.
First of all, listen to your own trusted investment advisor, as opposed to the sensational and headline-grabbing noise in the media. And then recognise that you are in control of your money, and managing your own investment behaviours is the key to your long-term success. Stick to your investment plan.
In this month’s Markets in One Minute, we have a section on what investors should do in relation to their investments. Below we’re going to remind you of some good behaviours that will help you to stay focused on the plan.
Keep your eyes on the horizon
Markets will always have ups and downs. But if you’re investing for retirement, building wealth, or saving for your family’s future, your goals are likely years, if not decades away. That long time frame is what your investment strategy is built around.
So as these short-term market moves might unsettle you a little, remind yourself that you’re in this for the long haul. Staying focused on the bigger picture is one of the best ways to protect your plan from emotional reactions.
Tune out the noise
I mentioned the noise earlier – every day brings a fresh wave of news from the US administration and a further slew of market predictions, opinions, and breaking news. It can be hard to know what to listen to, or what to do about it.
The reality is that most of the noise is just that: noise. Very few people can consistently predict what markets will do next. Instead of getting distracted by headlines, trust the strategy we’ve built together. It’s designed to perform through all kinds of market conditions, not just the calm ones. Always remember that volatility is simply a feature of investment markets and is to be expected.
One of the best ways to manage this volatility is through proper diversification—spreading your investments across different asset classes and sectors. Diversification helps cushion your portfolio against sudden swings in any single market segment.
Focus on your goals
There will always be some “experts” triumphantly announcing their success in volatile times. Which can make you feel like you got it wrong. But you didn’t, you stuck to your plan. You got it right…
Look, it’s human nature to compare your investments to others, whether it’s a friend’s portfolio or what you see on social media. But comparison rarely helps. Everyone’s financial goals, risk tolerance, and time horizon are different. Someone else might be comfortable with more risk or chasing short-term gains. That doesn’t mean their approach is right for you. The only thing that matters is whether your strategy and outcomes support your goals. That’s how you measure success.
Be realistic about returns
Of course we all want consistent strong returns. But it’s simply unrealistic to expect them every single year, without extreme risk taken and enormous amounts of luck.
Instead, focus on what’s reasonably achievable over time. A smart investment plan aims for steady, long-term growth and is built to handle both good years and bad ones. Regular reviews will help keep things on track – you’ve no need to chase unrealistic expectations.
Leave emotion at the door
Fear and excitement are powerful forces, and they often show up when markets move sharply. But emotional decisions like panic-selling during a dip or jumping in when the market is performing strongly can hurt your long-term progress.
As Warren Buffett famously said, “Be fearful when others are greedy, and greedy when others are fearful.” The best investment decisions are made calmly, with your long-term goals in mind. They’re not an emotional decision based on what the crowd is doing.
Don’t try to time the markets
Trying to guess the perfect moment to jump in or out of the market might sound smart, but in practice it’s incredibly difficult, even for professional investors. Many people will make this mistake during the current period of volatility, and for most of them it will be a very expensive misstep.
The risk isn’t just getting out at the wrong time, it’s missing the rebound when markets recover. Some of the strongest gains happen in short bursts, and if you’re on the sidelines, you miss them. The real advantage comes from staying invested and letting time do the work.
Stay the course, stick to the plan
Markets will always bring uncertainty as we’re currently experiencing, it’s just part of investing. But with a clear plan, realistic expectations, and a steady approach, you can stay focused and confident no matter what the headlines say.
If you’re ever unsure whether your investment strategy is still aligned with your goals, talk to us. A quick check-in can help bring clarity and peace of mind, and keep you on track for the future you’re working towards.
Key Takeaways Summary:
- Ignore Short-Term Volatility: Expect ups and downs, but remember your long-term goals.
- Diversify: Spread out your investments to minimise the impact of any single market move.
- Avoid Emotional Decisions: Keep a cool head to prevent panic-selling or impulsive buying.
- Don’t Time the Market: Missing the best days can seriously harm returns. Stay invested.
- Review Regularly: Adjust if your goals change, but stay consistent with your overall plan.
DISCLAIMER: All investing involves risk, including the possible loss of principal. Past performance does not guarantee future results. This information is for educational purposes only and does not constitute personalised financial advice. Please consult a qualified advisor for guidance specific to your situation.
