The Great Whipsaw Of 2025 Investors Need To Pivot Into Trump Era Stocks.
How quickly the financial landscape can change in just one year!
After 24 months of blissfully easy profits in the 'Magnificent 7' tech stocks, 2025 is a year of financial limbo where many investors are still dazed and confused from the beating they took during April's panic, then failed to profit from the market's rebound that made up the losses quickly – a classic whipsaw!
It is too soon to tell whether 2025 will be a flat year or just a brief, volatile interruption in a continuing bull market like what we saw in 2020's powerful reversal.
There have been other 'whipsaw' years!
Since 2000, there have been five previous years that produced pitiful year-end stock market returns that were not bear markets: 2005 3%, 2007 4%, 2011 0%, 2015 -1%, 2018 -6% (See chart).
S&P 500 Index Chart
Good News! Excluding 2007's financial crisis, the following years produced average returns of 16%!
What should investors do?
During stock market whipsaws, it is common for investors to commit the sell low & buy high mistake based on a lack of investment discipline or news headlines.
Here are four tips to help navigate volatile market conditions:
There is an old Wall Street saying, 'Don't confuse brains with a bull market.'
As an active money manager with over 30 years of experience, I have learned to pivot quickly to market conditions using these tips to great effectiveness. Whipsaw years are a great opportunity for investors to review their investment strategies and make adjustments
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