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Markets have moved quickly in recent days, and for many investors, that brings uncertainty. In this video, our Chief Investment Officer, John Cunnison, CFA, shares perspective on the current environment—highlighting how time-tested investment principles can help cut through the noise and guide smart decisions during volatile periods.

Periods of sharp market movement can bring out strong emotions in even the most experienced investors. Anxiety, stress, and fear are natural human responses—but they rarely lead to wise investment decisions. 

Just as trained professionals in other fields rely on muscle memory and preparation when stakes are high, investors benefit from steady principles that hold up when markets feel anything but calm. 

Here are a few of the core investment truths we fall back on during volatile periods: 

Diversification Works—Even When It Doesn't Feel Like It

Diversification can feel disappointing when one asset class is clearly outperforming others. Over the last decade, U.S. stocks often outpaced international markets, and bonds faced headwinds—especially in 2022.

But this year, we’re seeing diversification pay off. International stocks have outperformed U.S. stocks year-to-date. High-quality bonds have gained 1–2% in just the past week, offering the kind of stability they’re designed for. Real assets are up nearly 5% this year.

Diversified investors may not always top the charts—but they are more likely to weather downturns and stay invested long enough to meet their goals.

Missing the Best Days Can Hurt Long-Term Results

Market volatility doesn’t just bring risk—it also brings opportunity. Historically, some of the best daily and weekly returns follow closely after significant declines.

Investors who exit the market during downturns risk missing these critical rebounds. Staying invested—especially during turbulent periods—is often key to long-term success.

Markets Move Fast

Markets respond to new information rapidly. Recent volatility was sparked by surprises in policy announcements and international responses, which were priced in almost immediately.

While headlines can shift sentiment overnight, the market's swift reactions often create openings. High-quality companies may become undervalued during periods of fear—creating opportunities for long-term investors.

Control What You Can Control

Even when markets feel unpredictable, investors can take action in areas that matter:

• Rebalancing: Adjusting portfolios by trimming recent winners and buying undervalued assets.
• Tax-Loss Harvesting: Using market declines in taxable accounts to reduce tax burdens.
• Reviewing Financial Plans: Assessing how current allocations support long-term goals, especially during downturns.

If you’re unsure how long you could stay invested during a downturn without needing to sell, now is a good time to revisit your plan. Many investors find reassurance in knowing their strategy already accounts for uncertainty.

Volatility is a natural part of investing—but it doesn’t have to derail your plan. By falling back on well-established principles, investors can stay focused on what matters most and avoid emotional decision-making in the moment.