| Market volatility is inevitable in times of uncertainty, but a long-term investment approach helps navigate economic shifts | Diversification is key to balancing risk and reward, improving potential returns over an extended investment horizon | Financial reviews ensure investment strategies remain aligned with personal objectives and changing market conditions |
There is no doubt that the pandemic, the invasion of Ukraine, ongoing trade tensions (including Trump-era tariffs) and the cost-of-living crisis have contributed to market volatility. Economic and geopolitical events inevitably prompt investors to question whether now is the right time to invest or to remain invested. While dealing with such uncertainties is nothing new for long-term investors, Trump’s re-election and the reintroduction of tariffs have once again highlighted the importance of a sound investment approach based on careful planning and strategic asset positioning.
It is important to remember that some market volatility is inevitable; markets will always move up and down in response to events. Viewing these short-term fluctuations through a historical lens can help keep them in perspective.
The FTSE 100’s performance since its inception, for instance, charts more than four decades of major global events, from market crashes to recoveries, yet still reveals a consistent long-term upward trend. This resilience is a powerful reminder of why disciplined, long-term investing can weather even the most turbulent times.
Chart: FTSE 100 since inception to January 2026, source Yahoo and Trading Economics
The value of investments can go down as well as up and you may not get back the full amount you invested. The past is not a guide to future performance and past performance may not necessarily be repeated.
The bigger picture
Many investors are getting used to a variety of political, financial and economic factors and learning to look through the ‘noise’ to focus on what really matters. Portfolio diversity holds the key to approaching your investments and managing risk. It is important to think about longer-term timescales instead of focusing too intently on short-term events and market fluctuations.
Information within this document is based on our current understanding and can be subject to change without notice and the accuracy and completeness of the information cannot be guaranteed. It does not provide individual tailored advice and is for information purposes only. Some rules may vary in different parts of the UK. We cannot assume legal liability for any errors or omissions it might contain. Levels and bases of, and reliefs from taxation are those currently applying or proposed and are subject to change; their value depends on individual circumstances. No part of this document may be reproduced in any manner without prior permission.
Adopting the longer-term view
Investment requires a disciplined approach and a degree of holding your nerve if markets fall. Experienced long-term investors know that the worst investment strategy you can adopt is to jump in and out of the stock market, panic when prices fall and sell investments at the bottom of the market.
Finding the right balance
However concerning market fluctuations may be, it’s important to remember that we have jointly worked hard to formulate a financial plan which is in line with your personal requirements.
Diversifying your portfolio
Successfully achieving your long-term investment goals requires balancing risk and reward. By selecting a broad range of assets in line with your attitude to risk, objectives and time horizon, diversification aims to provide the potential to improve returns for your elected level of risk.
Communication is key
As an investor, you have to decide how much risk is right for you. While the process of building a portfolio will incorporate strategies designed to help reduce risk, it cannot be eliminated altogether. We also need to make sure that we are aware of any changes in your objectives or circumstances. And, of course, you should remember that volatility also creates opportunities for investors.
The right strategy
Financial advice and regular reviews are essential to help position your portfolio in line with your objectives and attitude to risk, and to develop a well-defined investment plan, tailored to your objectives and risk profile.
Financial advice is obviously key, so please don’t hesitate to get in contact with any questions or concerns you may have. All details are correct at the time of writing (January 2026).
Information within this document is based on our current understanding and can be subject to change without notice and the accuracy and completeness of the information cannot be guaranteed. It does not provide individual tailored advice and is for information purposes only. Some rules may vary in different parts of the UK. We cannot assume legal liability for any errors or omissions it might contain. Levels and bases of, and reliefs from, taxation are those currently applying or proposed and are subject to change; their value depends on individual circumstances. No part of this document may be reproduced in any manner without prior permission.
