Calm in the Chaos: What’s Really Driving Global Markets?

Markets trending up despite news the likes of which we have seen this year is actually not an unusual phenomenon. 

Omer says that, if you look at past market cycles, what they often do is quickly price in the worst-case scenario. From then on either the worst case happens or it's going to be less than that. 

What’s more, retail investor participation in U.S. stocks has reached historic highs, with many following the “buy the dip” mentality. 

As we often remind our clients: Bad investors sell off, good investors do nothing, but great investors lean into the market when they see a good buying opportunity. 

Retail investors who “bought the dip” in U.S. stocks this year have achieved their highest profits since the early days of the Covid-19 crisis, according to data from VandaTrack. 

One of the big topics which has affected markets this year has been the tension between Trump and Fed Chair Powell. 

When this first erupted back in April, the market reacted negatively. Wall Street stocks fell on Monday 21 April, after Trump reiterated his attacks against Powell. Off the back of the news, the S&P 500 fell 2.4%. 

But overall this year it is trading at 25 times earnings, which is historically high, with the top 12 companies reporting strong growth. 

Maybe Trump is bluffing when it comes to firing Powell, maybe not. But either way, news of the tension has ceased to affect the markets. Like the boy who cried wolf, news that is repeated with seemingly no end in sight tends to be forgotten about. 

If there’s one thing investors should take from the first seven months of this year, it’s that they shouldn’t lose their nerve when markets zigzag. 

The conversation between Chris and Omer touches on everything from U.S. government debt to fixed income investment performance, as well as how tech stocks are performing and the role of gold in diversified portfolios.  

Throughout the conversation, they both emphasise the importance of remaining invested in the market despite the noise, while making strategic adjustments to asset allocation based on economic conditions. 

Omer highlights that Aditum’s active management approach allows them to adjust weightings between stocks, bonds and gold as needed, potentially producing superior returns compared to simply holding ETFs through market cycles. 

If you’re concerned about your portfolio, make sure you contact your adviser or reach out to client services at client.services@hoxtonwealth.com, or by using the new dedicated WhatsApp number +44 7384 100 200.  

Alternatively, you can scan the QR code at the end of the video to get in touch.