By Stan Cho and Cora Lewis
NEW YORK (AP) – Huge swing rocking wall street and the global economy may feel far from normalcy. But at least to invest, this size decline has happened throughout history.
What makes them mad are the prices investors had to pay to get more profits the stock can offer than other investments in the long run. This is a glimpse into what lies behind the wild movements of the market and how experts advise people to consider both old and young.
How bad is the market?
Wall Street’s main benchmark, the S&P 500, has lost more than 16% since setting an all-time high on February 19, mainly due to concerns over President Donald Trump’s tariffs.
While all sorts of uncertainty about the economy will suspend Wall Street, the trade war makes it even more difficult for businesses, households and others to feel confident enough to invest, spend and create long-term plans.
The tariffs announced on the “liberation date” sent out stocks caught up in the worst day since the 2020 community crash crash, as they were far more severe than investors expected. They also raised fears that Trump might push along with them and win long-term profits, including more manufacturing jobs in the US.
The hope among investors was that Trump was simply using tariffs to win concessions from other countries. I still think that some of Wall Street’s big names are, and tariff moderation will help stocks recover, but now it’s not so sure.
Does stocks do this frequently?
It’s sufficient regularly. The S&P 500 has seen a decline of at least 10% each year. In many cases, experts view stock prices as an optimistic cul who otherwise runs overboard and may be too high.
Before this recent downswing, many critics said the US stock market was too high after prices rose faster than corporate profits. They also pointed out that only a handful of companies drove many of the market returns. Just seven large groups of high-tech companies account for more than half of last year’s S&P 500’s total returns, according to the S&P Dow Jones index.
Should I sell it out?
Seeing investors losing money makes me feel sick. This recent run has made me particularly worried because of how incredibly calm the market has been in the past. The S&P 500 has appeared for the second consecutive year, where he was shot more than 20%. This was the first time that happened since Buggy Pants last piled up style in front of the Millennium.
The sale may offer some peace of mind. But it also prevents opportunities to be trapped in losses and earn money over time. Historically, the S&P 500 has finally returned from all of its slump to make investors all over the world. These include Great Fear Presion, Dot-Com Bust and the symbiotic crash of 2020.
Some recovery takes longer than others, but experts often recommend not putting money in stocks that you can’t afford to lose up to ten for several years. Emergency funds such as home repairs and medical expenses should not be invested in stocks.
“Historically, it has shown that no one can spend time on the market,” says Papadimitriou, CEO of Wallethub. “No one can understand when it’s best to buy and sell consistently.”
Do I need to change anything with my investment?
For years, the US stock market has been a great place to invest around the world. Now more investors are questioning that our exceptionalism is dead.
However, investors can be reminded to often do their best when they have mixed investment sets rather than just a few times. And investors may not be as diverse as they thought after years of domination by Seven, a grander Seven than the US stock market and the global market.
“When there are days when a portfolio feels like it’s panmering, it’s difficult to roll in a punch,” said Brian Jacobsen, chief economist at Annex Wealth Management. “But these moments should pass. A variety of strategies that carefully adapt to changing circumstances cannot prevent punches, but can help ease the blow.”
Ambassador Wealth Management CEO Phil Battin advises investors to diversify investments across regions and sectors to mitigate risk. He says he will lean towards “resilient sectors such as consumer staples, utilities and healthcare that are less dependent on international trade.”
I just started investing in stocks. What should I do?
The surge in online trading platforms and ease of smartphones have helped create a new generation of investors who may not be used to such volatility.
But the good news is that young investors often have gifts of time. If they have decades before they retire, they can afford to ride the waves and recover their stock portfolios before they grow even bigger if the stock portfolio works.
“Now is not the time to make emotional decisions,” said Stephen Cates, a financial analyst at Bankrate. Young investors should “reenact (long-term) goals” and should consider using a financial advisor to navigate uncertain times. “Investors who have enough time to continue investing should remember how advantageous the lu-taking patience has been over the past 15 years,” Cates said.
What happens if I retire?
Older investors have less time than younger investors, which allows their investment to bounce back. But even in retirement, some people will need to invest in order to last for more than 30 years, said Niladri “Neel” Mukherjee, Chief Investment Officer at Tiaa Wealth Management.
Those who have already retired may want to cut their spending and withdrawals after a sharp market slump. But at least in the early parts of retirement, even retirees should be invested in stocks to prepare for the potential for decades of spending.
“You might want to slow it down and back up when the market recovers,” Mukherjee said.
How long will this last?
No one knows. Otherwise, don’t let anyone tell you.
Original issue: April 4, 2025, 2:20pm EDT
