Navigating Volatile Markets

Blog - 12 - 05 - 22

The recent stock market decline combined with the rising levels of inflation has given some investors cause for concern. While those concerns are natural, they can often lead to impulsive and brash investor mistakes.  It’s important to remain focused on the long-term in these situations and here’s why:

Market Timing

Building wealth requires “time in the market” and not “timing the market”. For investors who are thinking about sitting on the sidelines, consider the chart below. Since 1975, the S&P 500 has delivered an annualized return of 8.9%. However, if you exclude the best 100 days since 1975, the market was down over that period. It is also worth noting that many of the best days occurred near market bottoms.


This is a normal function of market cycles, and we believe it is not something long-term investors should fear. In fact, when volatility rises, it is often a sign that much better times are ahead. When the Volatility Index rises above 30, as it is of May 10th, the average return of the stock market over the following year has been 23% (see below).


Consumer Confidence 

This lack of optimism has been prevalent since the outbreak of the COVID-19 pandemic. Historically, periods of extremely low consumer confidence have led to higher equity prices two years later. Since 1978, when consumer confidence bottoms, the return for the S&P 500 over the following two years is 33.4% (see below).




As we navigate through this time, we want to remind you SteelPeak Wealth is committed to helping clients reach their long-term financial goals.

Contact us today to learn more.

Steel Peak Wealth Management, LLC (“SteelPeak Wealth”) is an SEC registered investment adviser located in California. There is no guarantee that any views, projections and/or opinions expressed herein will come to pass. This report should not be construed by any prospective investor as SteelPeak Wealth’s rendering of any personalized investment advice. Information on the registration status of SteelPeak Wealth is available at A copy of SteelPeak Wealth’s current written disclosure brochure is available upon written request. 

Any reference to the performance of an index is not indicative of the past performance of a particular investment. Indexes do not incur management fees, costs, and expenses. Individuals cannot directly invest in unmanaged indexes. Past performance does not guarantee future results. Certain information contained herein has been provided by, or obtained from, third party sources. While SteelPeak Wealth believes that such sources are reliable, it cannot guarantee the accuracy of any such information and does not represent that such information is accurate or complete. 

This document may contain forward-looking statements. Such statements are not guarantees of future performance and are subject to certain risks, uncertainties and assumptions that are difficult to predict. SteelPeak Wealth’s investments could differ materially, and an investor’s returns could differ materially and adversely, from those expressed or implied in any forward-looking statements as a result of various factors.