The Month in a Minute
📰 Overall: In a month filled with uncertainty, a long-term mindset can present opportunities such as cheaper, better-value stock prices. Tariff concerns shook global markets, causing investors to move to more defensive assets such as cash and bonds in March.
💪 Benchmark Performance: Relative to global equities, Wealthify's Original and Ethical Plans performed well this month, as bonds provided protection against equity losses, and defensive shares reduced turbulence.
🗒️ Plan Summary: In a volatile month where equities struggled, our defensive equity positioning and increased cash position helped protect Plans from volatility.
🕰️ Going Forward: It may be hard to visualise a turnaround in markets at this point, but the up-and-down nature of investing is normal. We’re optimistic that the diverse opportunities we’ve selected will continue to have a positive effect on Plans as we move through 2025, providing protection if economic conditions deteriorate further.
Tariff turmoil causes an unfamiliar and uncertain landscape for investors.
In market conditions such as these, we know it can be worrying to log in and look at your Plan.
The key, however, is to focus on your long-term financial goals.
Remember you’re an investor in it for the long run who can block out noisy headlines and ride out these market corrections — corrections that are completely necessary for markets to reach new all-time highs.
It can seem strange that the stock market is the only market in the world where once everything goes on sale, everyone runs for the door!
However, due to our more defensive stance over much of last year (preferring bonds over equities), we now have the cash needed to buy in to these markets at cheaper prices when the time is right.
March was a tough month for markets, as potential announcements on tariffs dominated headlines and caused markets to drop. US trade policies announced at the beginning of April have sent shockwaves around the globe, with growing recession fears and pushing the S&P 500 is first 10% decline in nearly 2 years.
Rest assured, however, that we’re monitoring the situation as it unfolds, ready to act accordingly once this uncertainty subsides.
And, while markets can price in risk and volatility — uncertainty can be a real problem.
On this occasion, uncertainty around tariffs created caution across all markets in March, as the potential impacts of these policies dampened growth prospects and increased inflation outlooks.
There have been plenty of concerns surrounding the potential damage to the global economy — this being one of the main reasons we’ve been positioned defensively over the past year.
US and European markets suffered the worst returns in March, as investors dealt with larger-than-expected tariffs (particularly on Europe’s car-making industry). UK markets fared slightly better, receiving tariffs on the lower end compared to others.
Thankfully, the performance of UK and European markets so far this year provided some to the volatility.
The best returns for the month were seen from Emerging Markets, which saw gains after investors fled from US equities to find cheaper prices elsewhere.
Investment Plan Performance
Market turmoil this month proved difficult for Wealthify Plans (as it will have done for many managed portfolios since the announcement of tariffs).
Bonds provided some protection, shielding Plans against the volatility of equity losses.
The defensive position we’ve had for the majority of the past year has paid off, limiting further losses — with our current increased cash position also protecting Plans.
Summary
With the impacts of Trump’s tariff policy yet to be fully realised, it’s tough to know what’s coming next for the global economy.
Through these turbulent times, it is important to remain focussed on the long term, with changes in direction like this being completely normal (and necessary to help markets break into all-time highs).
Our Investment Team continues to actively monitor the financial markets and their impact on Plans — and are always ready to act in your best interest as events unfold. We’re constantly evaluating new market information and key drivers, to help keep your Investment Plan on track.
It’s important to remember that it’s normal for markets to go up and down, with periods of volatility to be expected when you invest.
As always, we continue to look for opportunities to best position your investments, with the goal of protecting your money and achieving your long-term objectives.
With investing, your capital is at risk. Please remember the value of your investments can go down as well as up, and you could get back less than invested.
Wealthify does not provide financial advice. Please seek financial advice if you are unsure about investing.
Your tax treatment will depend on your individual circumstances, and it may be subject to change in the future.
