Investors should see through the latest market turmoil and stay committed to the market, according to DataTrek co-founder Nicholas Colas. In a report out Friday, Colas reported anecdotes of squeamish investors as a result of President Donald Trump’s on-again, off-again tariff policy, on top of worries around the health of the broad economy. The effect has been drive up uncertainty and send stocks into a tailspin. The broad S & P 500 entered a correction at one point last week — down 10% from its February peak — and is now down about 3% on the year. But Colas said there are several reasons to stay optimistic on the market. He listed four main bulwarks supporting prices, and advised investors to take a pause and wait to see how the current volatility plays out before opting to sell. “The temptation to just sell everything is strong right now,” Colas wrote to clients. “History proves the counterbalance to that sentiment. … The bottom line: investing has gotten harder, but the long-term rewards are still there.” .SPX YTD mountain The S & P 500 in 2025 First, Colas pointed out that it takes a “genuine” shock like a war or crisis for the S & P 500 to fall more than 10% in a calendar year. If an investor doesn’t believe an event like that will occur, it’s worth staying in to see how things play out, he said. Next, he noted that while “fear selling” is easy, it’s harder to “fear buy.” In other words, the bottom of a market is difficult to call, making it tougher still to reenter stocks at the exact right time. Colas further highlighted that Wall Street’s fear gauge, the CBOE Volatility Index (VIX) , is still in a bull market zone. Investors should only get worried when the index starts showing 19.5 as a “floor rather than a ceiling,” but emphasized that that’s not the case today. The VIX, which uses options to measure how much investors think the S & P 500 could rise or fall in the next 30 days, traded Friday between 19.08 and 20.91. .VIX YTD mountain The VIX in 2025 Finally, while some investors are concerned about small-cap underperformance or a breakdown in large-cap technology leadership, Colas said good news elsewhere provides offsets. Sectors such as financials and industrials have been able to avoid the drawdown, he said. On top of this, many international equities been outperforming, and investors should equal-weight international equities to hedge against economic uncertainty in the U.S., Colas advised. Colas understands the concern around the market right now, but said investors should be “accurately framing problems and then implementing solutions.” “The last month has been the most exhausting stock market ‘correction’ I can recall,” Colas wrote to clients before the market opened Friday. “So many uncertainties, so few answers, and things could certainly get worse before they get better.” “However, we know it takes a sharp shock, not just an annoying drip of negative news, to truly kill a bull market,” he added. “While another 5-10 percent decline is entirely possible, we don’t think that is too heavy a price to pay for continued exposure to [U.S.] equities over the longer term.”
:max_bytes(150000):strip_icc():focal(918x299:920x301)/Brady-Bunch-Reunion-033025-02-b3d4213f8d5843279e93336f284c0aca.jpg "The Brady Bunch Actors Reunite at the Chocolate Expo, Share Set Memories")
