A Look Beneath

Markets have seemed uneasy this year. Nothing extreme or unprecedented has occurred compared to years past, yet for some reason it’s felt uncomfortable.

While that discomfort can create the impression that something is amiss, it’s worth noting that what’s been different isn’t what you think. Volatility has actually been uncharacteristically lower than on average.

Despite some unsettling headlines around tariffs, geopolitics, inflation, oil spikes, and Federal Reserve investigations, the market has been unusually calm.

Even in years that ultimately finish positive, the average drawdown in the S&P 500 is approximately 10%. We didn’t quite get there with this April’s 9% pull-back, so there may be more disruption to come.

It’s worth remembering that markets regularly produce corrections along the way and headlines tend to amplify those moments. Outcomes are determined over full cycles, not short windows.

The cost of trying to avoid that volatility is often higher than the volatility itself. Some of the strongest long-term results come from simply staying invested through periods that feel uncertain. Missing just a handful of the market’s best days (which are often clustered around some of the worst ones) can meaningfully change long-term outcomes.

So what is important right now? Not predicting the next move or reacting to every headline. Take note that the market doesn’t know or care about your individual financial situation. Your goals are yours alone and only you can control how you intend to reach them.

A good financial advisor should help to hold you accountable to those goals and the path you’ve set out to get there. Whatever they may be, they are usually reached through discipline and the ability to filter out the things that are out of your hands.

Market volatility isn’t an interruption to long-term investing, it’s part of it. More often than not, they are the exact moments that reward patience, not reaction.

Read more about how volatility rewards accumulators.