We find ourselves in the midst of market turmoil, the result of a US President who seems to be making up economic policy on the run. This is evidenced by the series of tariff back-flips he has performed in less than 2 weeks in regards to their application, severity, recall, escalation, pausing and exceptions. Let’s not forget the insider trading moment when he alerted his followers that “it’s a great time to buy”. Surely the Democrats are keeping that one warm for when the time comes.
Anyway, the golden rule in times like these are as follows:
- Don’t Sell, crystallising paper losses into real ones. The market will recover.
- Buy the Dip. If your bought a business last year at $1 and felt it was a good price, if the fundamentals of that business remain solid then buying more now at $0.80 is a bargain.
- There is no certainty about the market, other than at some time in the future the market will return to it’s February 2025 high and then keep going. Selling now hoping to buy back in lower could bring spectacular rewards, but where is that re-purchase point? Being greedy for bargains could result in hanging on too long. The general wisdom is to not sell, but invest periodically with extra funds when the market is depressed to increase the value of future gains.