“No rain, no flowers.” – Haruki Murakami
Markets have felt like a late spring tsunami, reminding us that volatility can arrive quickly. It’s a good moment to take a deep breath, reflect, and recalibrate.
Market Check-In: A Turbulent Season
This April, markets faced a sharp downturn, driven by tariff tensions and global uncertainty. Valuations have dropped, and recession concerns have surfaced, challenging the “buy the dip” mindset many investors have held for decades.
What’s different now? Unlike past crises where government stimulus stepped in, this market uncertainty is self-inflicted, tied to policy decisions and the potential for renewed inflation, leaving fewer backstops for investors.
Recession Risks & Tariffs
President Trump’s new tariff policies could reshape the global economic landscape, shifting away from decades of increasing free trade. The market is reacting, and while we can’t predict how this will play out, it’s clear we’re in a period of true market uncertainty.
Contrarian Signals in the Noise?
History shows markets often rebound after heavy downturns. In 1987, markets dropped 22% in a day but still ended the year positive. Recent sentiment surveys show high levels of investor pessimism, which can sometimes signal a turning point.
While we remain cautious, we’re open to the possibility of a rebound if policies shift or optimism returns.
The Value of Diversification
Bear markets test investors’ resolve, but diversification proves its worth during these periods. In 2025:
- International stocks have outperformed U.S. stocks.
- Bonds are up and providing stability.
- Large Cap Value stocks are holding up better than broader markets.
Diversification helps reduce the pressure to react emotionally, allowing investors to stay on course and benefit from long-term growth.
Risk Management & Your Comfort Zone
Market volatility can reveal your true risk tolerance. If you’re feeling anxious, it may be time to revisit your asset allocations. Staying invested is key to long-term success, but it’s equally important to align your strategy with your comfort level.
Let us know if you’d like to review your portfolio—we’re here to help you find the right balance between growth and peace of mind.
Client Tip: Five Years from Retirement? Time to Adjust
If you’re within five years of retirement, consider these steps:
- Shift to a more conservative allocation to protect your portfolio.
- Diversify asset classes to cushion downturns.
- Build a cash reserve of 1–3 years of expenses.
- Plan your withdrawal strategy carefully, using a bucket or bond ladder approach.
- Rebalance regularly to stay aligned with your goals.
This period is crucial for ensuring your hard-earned savings are protected as you prepare for retirement.
Perspective for the Road Ahead
Markets have always recovered, whether after the 2008 financial crisis or the 2022 downturn. Volatility can feel unsettling, but history shows the value of staying invested with a clear plan.
Stay healthy, stay patient, and know we’re here to help you navigate every wave.
– The BirdRock Wealth Team
“Helping to secure your financial future so you can live a life you love.”