In periods of heightened market volatility like we have seen in the past few weeks, it is very important to take a step back and remind ourselves what it means to be a disciplined investor and the intentional approach we take when building investment portfolios.
First, we need to remind ourselves that volatility is a necessary component of investing. Without it, there would be little potential for return, as price movement up and down allows investors to make gains as they adjust their expectations about companies, the economy, interest rates, and global events. And while volatility can be uncomfortable in the short term, it can actually be a sign of a healthy, functional market. In fact, despite an average intra-year drop of 14.1%, annual returns of the S&P 500 have been positive in 34 of the past 45 years.1
Next is a reminder that our clients don’t own “the market” – they own shares of high-quality companies with strong management teams. In past market cycles, these companies have continually evolved in response to the current operating environment, and we would expect this time to be no different. And while it can be easy to think, “this time is different – we cannot come back from this,” there are plenty of examples throughout recent history (COVID-19, housing crisis, dotcom bubble, etc.) where our economy and stock market have bounced back from crisis, proving to be incredibly resilient.
Finally, a reminder of how important diversification across stocks, bonds, and other asset classes is during times of market volatility. Different asset classes often react differently to economic and market conditions; when stocks fall, bonds or other assets like real estate or commodities may perform better, and vice versa. By spreading investments across various types of assets, investors can reduce the impact of any single market movement and create a more stable and resilient portfolio. This diversified approach is exactly how we build investment portfolios at Curi RMB Capital, allocating a portion of the portfolio to cash and fixed income assets to use as liquidity and dry powder in periods of uncertainty, while allocating the remainder to equities and alternatives to provide growth and the potential to outpace inflation over time.
Markets will continue to move up and down as they always have, and we have to remind ourselves that much of what happens is out of our control. This is why it is so important to focus on things we can control, such as our emotions and staying invested in times of uncertainty. And when in doubt, we always fall back on our guiding light: the long-term financial plan we have established together.
- J.P. Morgan Asset Management. (2025). Guide to the Markets – U.S. (Slide 16). Retrieved April 23, 2025, from https://am.jpmorgan.com/us/en/asset-management/institutional/insights/market-insights/guide-to-the-markets/financial-advice-gap/.
Disclaimers
The opinions and analyses expressed in this presentation are based on Curi Capital, LLC’s (“Curi Capital”) research and professional experience are expressed as of the date of our mailing of this presentation. Certain information expressed represents an assessment at a specific point in time and is not intended to be a forecast or guarantee of future results, nor is it intended to speak to any future time periods. Curi Capital makes no warranty or representation, express or implied, nor does Curi Capital accept any liability, with respect to the information and data set forth herein, and Curi Capital specifically disclaims any duty to update any of the information and data contained in this presentation. The information and data in this presentation does not constitute legal, tax, accounting, investment or other professional advice. An investment cannot be made directly in an index. The index data assumes reinvestment of all income and does not bear fees, taxes, or transaction costs.
