The article emphasizes that the current stock market downturn, driven by tariff fears, may encourage some investors to reassess their equity exposure. While defensive assets are a safer option for those who can't tolerate fluctuations or have short investment horizons, younger investors with long-term perspectives and consistent income might find value in market sell-offs. The piece suggests gradually investing in quality stocks, even amidst volatility, and highlights that modestly-valued defensive stocks could provide a good strategy during tumultuous times.
If you can't handle volatility or don't have a time horizon that's long enough to stick things out until an eventual rebound, rotating into more defensive assets is seen as a prudent move. Investors may be tempted to give up on equities, but younger, long-term investors, especially those still raking in cash, might benefit from viewing current market sell-offs as opportunities.
Steadily adding to positions at discounts on the way down still seems like a sound long-term move. The modestly-valued defensive stocks can be a great way to invest through a stock market that's markedly more volatile than the one we've grown accustomed to since 2023 began.
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