With the recent tariffs announced by Donald Trump and the global response from world leaders, markets have been thrown into a period of heightened uncertainty and volatility.

Share prices have dropped significantly, impacting pension and investment funds. While there has been some recovery in the days following the introduction of global tariffs, it may take time for markets to fully rebound.

It’s easy to panic during such periods, but it’s important to take a step back. Market dips are normal. The “Market Falls Every Year” chart (source: Albion Strategic Consulting) illustrates global equity returns since 2001 and tells a compelling story: volatility is part and parcel of investing. In 15 of the past 25 years, markets have seen drops of 10% or more. Yet, despite these significant intra-year declines, most years still ended in positive territory.

What’s more notable is the long-term trend. Over the past 25 years, investors have seen their purchasing power double approximately every 18 years, even after adjusting for UK inflation. That’s a strong outcome, especially considering the crises navigated along the way—from the dot-com bubble to the COVID-19 pandemic.

Timing the Market vs. Time in the Market

Rather than trying to time the market, we believe in the value of staying invested for the long haul. History shows that those who stayed invested—despite short-term volatility—typically saw returns exceed inflation by around 4% per year. Of course, past performance is no guarantee of future results, and personal circumstances should always be taken into account. But for long-term investors with well-diversified portfolios, market wobbles shouldn’t trigger undue concern.

 The key takeaway is this: it’s not about avoiding volatility—it’s about managing it and planning with a long-term mindset.

Questions?

If you have any questions, please speak to your Independent Financial Adviser