Welcome to our April 2025 Viewpoints, a monthly bulletin from PDS Planning to our valued clients and friends. Our goal with each issue of Viewpoints is to provide you with a wide variety of perspectives on life and wealth. Feel free to share with others.
Reasons to Sell
From the Global Financial Crisis in 2008 to Brexit in 2015 to the Covid Pandemic in 2020, there’s always something going on that could present a reason to sell sell sell! Through all of these significant market and economic events, the long-term trend upward has prevailed. The right side of the chart below shows the average annual return an investor would earn if they stay invested through those significant events. While this time (tariffs and trade) may be different, it may also be the same.
Possible Tariff Rate
The word of the year so far is Tariff, that’s for sure. The reciprocal tariffs that were implemented, then paused for 90 days, varied greatly between countries based on the rate charged to the US as well as the deficit. The chart below helps visualize the weighted average tariff rate on total imports after the ‘Liberation Day’ announcement. This would be the highest rate since 1910 if the current plan proceeds without change. The precipitous jump makes the recent market volatility a bit easier to understand.
Inflation
Inflation peaked in June 2022 and has since been trending down. The slope of the trend line has flattened, but it’s still heading in the right direction to meet the Fed’s goal of 2%. A big question linked to tariffs is how they may impact inflation. As it stands today with the 90-day pause in effect, we’ll just have to wait and see.
Single Stock Volatility
We’ve experienced some wild market swings this month. One day the S&P was down -6%, the next it’s up 9.5%! JPMorgan compiled data from the S&P 500 since 1995 looking at annual individual stock volatility. Throughout the year, an average of 372 stocks in the S&P 500, almost 75%, will pullback at least 5%. Think about that. In 2023 and 2024 when the markets were up more than 20%, most stocks in the index fell at least 5% at one point. Volatility is heightened right now, but is a normal experience throughout the year.
IMPORTANT DISCLOSURE INFORMATION: Please remember that past performance is no guarantee of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by PDS Planning, Inc. [“PDS”]), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from PDS. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. PDS is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice. A copy of the PDS’ current written disclosure Brochure discussing our advisory services and fees is available for review upon request or at www.pdsplanning.com. Please Note: PDS does not make any representations or warranties as to the accuracy, timeliness, suitability, completeness, or relevance of any information prepared by any unaffiliated third party, whether linked to PDS’ web site or blog or incorporated herein, and takes no responsibility for any such content. All such information is provided solely for convenience purposes only and all users thereof should be guided accordingly. Please Remember: If you are a PDS client, please contact PDS, in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing/evaluating/revising our previous recommendations and/or services, or if you would like to impose, add, or to modify any reasonable restrictions to our investment advisory services. Unless, and until, you notify us, in writing, to the contrary, we shall continue to provide services as we do currently. Please Also Remember to advise us if you have not been receiving account statements (at least quarterly) from the account custodian.
