Market downturns can feel unsettling, especially when driven by fear and uncertainty rather than economic fundamentals. While we can’t predict exactly how long this volatility will last or what will bring it to an end, history shows that markets are resilient. Economic cycles fluctuate, but while past performance is no guarantee of future results, those who remain patient and disciplined tend to benefit in the long run.

Many of the recent declines appear to be rooted in uncertainty rather than a fundamental economic collapse. Investor sentiment can shift rapidly due to concerns about policy changes, trade tensions, or global events. However, as more information becomes available and uncertainty fades, markets typically find stability and recover.

Tariffs, in and of themselves, we believe are a bad idea economically. They violate the principles of free trade and extend greater government overreach into American citizens’ and businesses’ private financial dealings. In the end, we believe that Trump understands these things but is willing to inflict some short-term pain on the economy to correct several structural problems that have built up over the past several decades. Tariffs are sometimes used as a short-term tool to negotiate better trade agreements. If our perception of Trump is correct, we believe that the tariffs will be reduced and/or rolled back as better trade deals are hammered out with other nations.

But in times of market correction, we want to remind you of some of the “secrets” to investing success.

 

The “Secrets” to Investing Success

Now, calling these “secrets” might be a bit misleading. There is no “magic strategy” that works for every investment in every situation. However, the following principles can help the good steward find success over time.

  1. Take advantage of market corrections. People often ask us if they should stop adding to their investment accounts because they are “losing money”. They feel that adding money to a fund that is decreasing in value is like throwing good money after bad. The good steward, however, recognizes that market declines are a great time to invest. If the investment is sound, an investor can purchase more shares at a lower price. It’s like shopping when everything is on sale. Rather than being bad times to invest, market downturns are perhaps some of the best times to invest.
  2. Don’t try to time the markets. Picking the tops and bottoms of the market is a fool’s errand, but that doesn’t stop people from trying. The problem with this is that the future is fundamentally unknown to all but God. There is no way to predict the direction of the markets over the short term. However, we know from history that given enough time, markets do tend to go up. The good steward continues to invest through all market cycles.
  3. Don’t Trust your Emotions. We often buy based on intellect when we see that an investment is performing well, but we then sell out of fear when it’s not doing so well. On average, one year out of every four will yield negative market returns. When an investment has a negative return, don’t panic. If you’re consistent, you won’t need to fear.
  4. Buy low and sell high. We just said that market timing is a bad idea, but in general, selling an asset while its price is down is also a bad idea. Try not to sell assets at a loss if you can avoid it. On the other hand, if asset values are increasing, that might be a great time to take some of your profits to replenish cash holdings, or set funds aside for future purchases. Don’t let fear or greed drive you to sell low and buy high. 

 

What should you do during this market correction? 

First, avoid knee-jerk reactions. Doing nothing is probably a good idea at this point. One of the worst mistakes investors make is reacting emotionally to short-term fluctuations. Avoid the temptation to check your portfolio daily or be swayed by sensational headlines. Instead, focus on your long-term financial goals. Try to tune out the headlines for the next few weeks. Let us worry about it for you. We will make changes to the managed accounts as needed.

Second, invest. If you have money on the sidelines, consider dollar cost averaging into the market. We remain bullish in the long term on the market because of some of the changes initiated by the Trump administration. If successfully implemented, these changes have the potential to lay the foundation for economic growth for decades to come. 

Third, rebalance. Different asset classes (stocks, bonds, mutual funds, ETFs) react differently to market conditions. Some sectors may have declined significantly, while others may have gained value. Now is a good time to review your portfolio and rebalance if needed to maintain proper diversification.

Fourth, keep a long-term perspective. Historically, markets have recovered from downturns, whether triggered by economic crises, policy changes, or geopolitical events. Investors who stay patient and maintain a well-diversified portfolio are often rewarded over time.

 

Uncertainty is an inevitable part of investing. However, those who focus on their long term goals rather than short term fear tend to make better financial decisions. Stay the course, trust in a disciplined strategy, and allow time and sound financial principles to work in your favor. Most of all, trust that the Lord will provide for all that you need. We have confidence in this: nothing that has happened has occurred outside of God’s sovereign will. May this be an opportunity for us to grow in Him.

If you have any concerns about your portfolio or investment strategy, we’re here to help!

 

Past performance is not a guarantee of future results.

Securities & Advisory services are offered through Geneos Wealth Management. Member FINRA/SIPC