As we are in the middle of Spring, we’re reminded that weather during this season can often be wildly unpredictable. Beautiful sunny days can give way to sudden cold snaps or violent thunderstorms overnight, frequently with blue skies returning the very next day. It is unquestionably a time of transition; very unpredictable, but also not unexpected. The recent swings in the financial markets are somewhat similar, especially for investors trying to make sense of it all.

As you have likely noticed, the financial markets have also been quite volatile over the past several weeks. Investor concerns over the direction of interest rates, inflation, corporate earnings and unemployment have resulted in some portfolios looking like they have been riding a roller coaster. And just like spring, you sense something is changing, but you’re not sure what, when or for how long.

Now add in the effects of on-again, off-again, (on-again?) tariffs which have brought with them an additional layer of complexity and uncertainty. Recent policy decisions have proposed tariffs on everything from autos and food to clothes and computers and almost everything in between. This includes parts needed for manufacturing products here in the U.S. For companies, this can increase costs and disrupt global supply chains. That means more portfolio volatility, much like a cold front moving in after a warm April day.

For many investors, it’s often tempting to want to react in times like these. But just as we don’t pack away our jackets after the first warm Spring Day, it’s wise not to make impulsive portfolio changes based on short-term market fluctuations. Volatility isn’t a red flag. In fact, it’s part of the normal economic landscape. It’s times like these that we are once again reminded that volatility is a feature of the system, not a bug.

So, what is an investor to do?  First, be careful of making quick decisions based on the “CNBC expert” you just watched or the random post you just read on social media. Emotional reactions to market volatility can come at a cost. Emotional decisions often lead to inadvertently buying high and selling low. In fact, research from DALBAR illustrates the average investor underperforms the market, largely due to poor market timing decisions. Over a 20-year period, the average equity fund investor earned only 5.3% annually, while the S&P 500 returned 8.2% during the same period. Another study by J.P. Morgan showed that over a 20-year period, returns were reduced in half just by missing the ten best days in the market over that span. This illustrates the incredibly difficult challenge of market timing. You must be right twice; when to get out, and when to get back in. And like Spring weather, the markets can change very quickly, often too quickly to make changes to your portfolio.

Eventually, just like the spring weather, the markets will calm down. At American Trust Wealth, we manage investments with a long-term focus. We realize that market volatility is normal and to be expected. That’s why we design client portfolios to mitigate market risk with diversification as a high priority, while occasionally making a few minor tweaks to take advantage of market timing opportunities.

In summary, your long-term strategy should not change with the weather or with every post you read on social media. If recent market moves have you questioning your portfolio, now is a great time to review your long-term plans with your American Trust Wealth advisor.