The US stock market has reacted badly to Donald Trump’s tariffs. The market doesn’t like barriers to trade. The high flying NASDAQ is down -12.54% year to date, while the S&P 500 is down -9.56%. The diversification of the Global Stock index has provided some protection and is down -6.67% (it is still heavily invested in US stocks).
In the four years of the Biden administration, the S&P 500 returned, 38.11%, -12.99%, 21.65% and 33.01%. 2022 was the negative year when inflation was high and Russia invaded Ukraine. Otherwise, things went pretty good for markets and we didn’t concern ourselves with politics. That has all changed under the Trump administration and it is exhausting already.
We have been here before. And I don’t mean the second Trump administration. I mean volatility. Ups and downs are a feature of investing. You can’t have smooth sailings all the time, sometimes there will be a storm. The problem with volatility is we do not know when it will happen, what will cause it, how bad it will be or how long it will last for.
If we look at the chart below, there are so many events that we could not have predicted, events that saw our investment fall in value. But we can also see that the value of our investment rose over time…as long as we stayed invested.
I have been writing this blog for almost twelve years now and have written lots of articles (there is 187 articles under the investment tab) about staying invested, not trying to time the market, don’t panic. An article from 2014, Why don’t we make money like Warren Buffett? Staying in the market and not panicking is key.
Steven Barrett
17 March 2025