As advisers, your clients look to you for clarity when markets become unsettled. Recent volatility driven by events like war and the current energy disruptions is a perfect example of how quickly sentiment can shift. Markets fall. Headlines intensify. And then often just as quickly stability returns and markets recover.
The challenge is that clients tend to remember the fear, not the rebound.
The images above represent the comet-tails or track of movements of ETF securities and their risks (horizontal-axis) versus their returns (vertical-axis) at dates 20th March (left) which was the bottom of the market and 21st April (right) only a month later.
The investor need only see that by the 20th March, the market had reacted to the war by diving in unified panic to the bottom-right (lower returns and higher risk). By the 21st April, just a few weeks later the market had resiliently climbed back upward to normal risk and returns.
Investors who sold in panic near the March low-point incurred significant losses.
Those that held steady held on to their capital.
In war, healthy markets have a tendency to revert after an initial panic reaction. Please see our previous post, a study on the resilience of markets in time of war.
Short-term market movements are unpredictable, but investor behaviour is not. Clients are most likely to make poor decisions — exiting the market or switching strategies — at exactly the wrong time. The cost of this is real: missing even a handful of recovery days can materially reduce long-term returns.
Our ETF portfolios are designed to support you in navigating exactly these moments. For example ETF solution provides broad, diversified exposure across local and global equities, bonds, property, and cash, ensuring that portfolios are not overly reliant on any single market outcome. This diversification helps cushion short-term shocks while maintaining exposure to growth when markets recover.
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Importantly, our portfolios are constructed using low-cost ETFs selected through a disciplined, rules-based process, removing emotion and guesswork from investment decisions. It’s a structure that aligns perfectly with the message advisers need to deliver: consistency, discipline, and long-term focus.
Despite short-term fluctuations, the longer-term performance profile remains compelling.
It’s about time in the market.
Not timing the market.
That ultimately drives outcomes.
What is immediately apparent is the Iran war is just another blip on the portfolio return history.
In uncertain markets, clients don’t need more information.
They need conviction.
Our ETF portfolios give you the tools to provide just that.
