In the world of investing, uncertainty is a given. But certain events—such as geopolitical tensions, natural disasters, or sudden policy changes—can cause more pronounced market reactions. One such current event is the imposition of tariffs by U.S. President Donald Trump, which has led to significant volatility across global markets. While headlines may scream doom and gloom, it’s vital for investors to maintain a level head and avoid making decisions driven by fear or emotion.
Here are seven practical strategies to help investors stay calm during such turbulent times and stick to their long-term goals.
1. Revisit your investment plan
In times of uncertainty, your investment plan is your anchor. A good investment plan is designed with market volatility in mind. It accounts for your risk tolerance, time horizon, and financial goals. If you’ve built a well-diversified portfolio based on sound principles, there’s usually no need to make drastic changes during temporary turmoil.
Ask yourself:
- Has my investment horizon changed?
- Have my financial goals changed?
- Am I losing sleep over market drops?
If your answers are no, then stay the course. If the market is falling but your long-term goals are intact, your plan is working as expected.
2. Tune out the noise
Financial news can often emphasise drama and urgency, which can make market movements seem more alarming than they actually are. This kind of coverage can stir emotions and make it harder to think clearly about your investment decisions.
Try to:
- Limit exposure to sensationalist media
- Stick to balanced sources of economic analysis
- Avoid daily checking of your portfolio during volatility
The media thrives on clicks, but you don’t need to respond to every twist and turn in the markets. Think of investing like gardening: checking your portfolio every day is like digging up your plants to see if they’re growing—it only causes stress and rarely helps.
3. Focus on what you can control
There are many aspects of the market that are beyond your control—tariffs, interest rates, political outcomes. What you can control are your savings rate, asset allocation, investment costs, and behaviour.
Use this period of uncertainty as an opportunity to:
- Rebalance your portfolio if asset classes have drifted from your targets
- Increase contributions to your investment accounts while prices are lower
- Review your expenses and lower your investment fees where possible
By focusing on actions within your control, you turn anxiety into productivity, which helps reinforce a calm, proactive mindset.
4. Embrace dollar-cost averaging
Dollar-cost averaging (DCA) means investing a fixed amount of money at regular intervals, regardless of market conditions. This strategy helps you avoid trying to time the market and smooths out your purchase price over time.
During volatile periods, DCA can be especially effective. It allows you to buy more shares when prices are low and fewer when prices are high—without having to predict market bottoms. For long-term investors, volatility can be your friend when paired with DCA. Market dips effectively go “on sale,” giving you more value for your investment dollars.
5. Diversify, diversify, diversify
If you’ve put all your money into a narrow set of industries or regions—say, U.S. industrials or Chinese manufacturing—you may feel the impact of tariffs more acutely.
Diversification helps cushion the blow from market shocks. By spreading your investments across asset classes (stocks, bonds, REITs), geographies (U.S., Europe, Asia), and sectors (technology, healthcare, consumer staples, etc.), you reduce the risk of being overly exposed to one troubled area.
Exchange-traded funds and mutual funds can provide instant diversification. Consider funds that track global indices, dividend payers, or defensive sectors like consumer staples and utilities during periods of economic uncertainty.
6. Remember: Volatility is normal
It’s natural to feel uneasy when markets fall, but downturns are part of the investing journey. In fact, a market correction (a drop of 10% to 20%) happens roughly once every 2-3 years in the stock market.
The key is recognizing that volatility isn’t a signal to panic, but rather a feature of the system. Markets correct, recover, and often reach new highs. The S&P 500, for instance, has delivered strong long-term returns despite going through wars, recessions, pandemics, and political upheavals.
7. Learn from history
History can be a calming teacher. Consider past events that caused market panic:
- The Global Financial Crisis (2008–09)
- The U.S.–China trade war (2018–19)
- COVID-19 market crash (2020)
Each of these events caused significant drawdowns, and each time, markets eventually recovered and moved higher. Investors who stayed the course were rewarded; those who sold at the bottom often missed the rebound. Reminding yourself of these patterns can help put today’s turmoil into perspective.
Stay calm, stay invested
Trump’s tariffs may introduce uncertainty, but they are not a reason to abandon your investment strategy. Emotional reactions to market turbulence are natural, but acting on them can do more harm than good. Instead, lean on your long-term plan, avoid the noise, maintain discipline, and look for opportunities. Remember: successful investing isn’t about avoiding storms—it’s about learning how to sail through them.
Stay calm, stay invested, and trust that time in the market beats timing the market.
Rule no. 1 – Don’t panic sell.
Rule no. 2 – Don’t blindly follow the crowd.
Market dips can be thought of as buying opportunities, though Don’t try to catch the proverbial falling knife. Let the dust settle first.
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