Stock Market Volatility: Perspective in Uncertain Times
Why Is The Market Down Right Now?
The recent market decline isn’t rooted in economic weakness—it’s a result of policy shock. Uncertainty around fiscal and geopolitical decisions has spooked markets, but the fundamentals remain intact.
This is a self-induced dip, not a structural breakdown.
What’s Ahead in 2025?
We believe there’s reason for long-term optimism. Here’s why:
- Tax reform and a new Budget Reconciliation bill may give markets a boost.
- Ongoing deregulation could support economic growth.
- Advances in artificial intelligence hold long-term growth potential.
Remember: markets price in the future—typically 6–12 months ahead.
It Always Feels Different.
Every bear market feels unique. And every time, headlines scream that “this one is different.” But history tells a more reassuring story:
“Over the last 16 years, I’ve seen several bear markets. Each felt scary and different. But every single time, the market made new highs over the next 1, 2, or 3 years.”
Staying Invested, Despite Negative News
Even in turbulent years, markets have rebounded. The table below shows examples from each year ending in “5”—a nod to where we are now, in 2025.
Lesson: Ignore the noise. Time rewards patient investors.
Opportunity in Uncertainty
“Most of the money is made buying solid companies in terrible markets.”
Right now, we’re invested in companies building the future. Maintaining long-term discipline often beats short-term reaction.
The Cost of Missing The Best Days
One of the biggest risks? Trying to time the market.
Good days happen in bad markets.
- Many of the best market days occur in the middle of downturns
- Missing them can significantly reduce long-term returns
Staying invested is often the best move.
Good days happen in bad markets.
S&P 500 Index Best Days: 1995-2024
Missing the market’s best days has been costly.
S&P 500 Index Average Annual Total Returns: 1995-2024
Past performance does not guarantee future results. For illustrative purposes only. Data sources: Ned Davis Research, Morningstar, and Hartford Funds, 1/25.
Recession ≠ Market Loss
It may be surprising, but the S&P 500 has often posted gains during recessions.
Markets tend to rebound before a recession officially ends.
Stocks have posted positive returns during recessions more often than not.
S&P 500 Index Performance During Recessions Since 1945
Past performance does not guarantee future results. Indices are unmanaged and not available for direct investment. For illustrative purposes only. Data sources: Morningstar, Ned Davis Research, and Hartford Funds, 2/25.
What About Policy-Driven Declines?
Here’s a look at ten major policy events that rattled markets—and how investors fared afterward.
10 Policy Decisions That Caused Market Turmoil
Long-Term Growth Despite Policy Uncertainty
A $10,000 investment in 1971—amid the gold standard exit—has grown exponentially.
Growth of $10,000 from 1971-2024
Despite wars, recessions, and pandemics, the trend remains upward.
As of 12/31/24. Past performance does not guarantee future results. Data Sources: Morningstar, Ned Davis Research, and Hartford Funds.
After Big Down Days: What Comes Next?
April 7, 2025: The largest intraday swing in the S&P 500 since March 2020.
History shows that after major selloffs, markets tend to recover in 1 month to 2 years.
When we zoom out to take a broader view after the largest 2 day declines we see how markets have performed 1 month later, 3 months later, 6 months later, 1 year later and 2 years later. In each case the market has recovered and been higher 1 year later.
Performance After Worst 2-Day Declines
In every historical case, markets were higher 1 year later.
Final Thoughts
Fear is normal—but so is recovery.
Markets are resilient. If we stay focused on long-term goals and avoid emotional decisions, we’re positioned to benefit from that resilience.
I am here to help guide you through uncertainty.
| Philip Lockwood | Founder + Managing Partner |
| Address: 1501 Ingersoll Ave. Suite 201 Des Moines, IA 50309 Phone: 515-274-8006 |
| Email: Plockwood@parklandrep.com Website: Lockwood Financial Strategies Securities offered through Parkland Securities, LLC, member FINRA (FINRA.org) and SIPC (SIPC.org). Investment Advisory services offered through SPC, a Registered Investment Advisor. Lockwood Financial Strategies, LLC is independent of Parkland Securities, LLC and SPC Securities offered through Parkland Securities, LLC, member FINRA/SIPC. |