Investing in uncertain times: How to build resilience in your portfolio
3 Minute Read
Summary
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Market declines are normal, with U.S. stocks historically negative in 25 per cent of years.
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Experts stress long‑term discipline, diversified portfolios, and avoiding panic during volatile narratives.
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Automating contributions and consulting advisors strengthens resilience when financial stress feels overwhelming
Investing is intimidating, especially in the current economy. Since the pandemic, we have been repeatedly warned about the risk of recessions. We’ve seen the cost of living skyrocket (looking at you, groceries), the value of the Canadian dollar has plummeted, and the U.S. trade policy just keeps adding to the overall uncertainty Canadians have faced over the last few years.
For many of us, finances are tight, so the idea of putting any extra money into an investment right now just seems unachievable.
But if you can continue to afford to invest, it’s still very worth your while.
Stock market declines and crashes are regular. In fact, not only are they normal, but they are to be expected, says Ben Felix, Chief Investment Officer at PWL Capital.
A look at annual data for U.S. stocks dating back to 2025 shows that stock returns are negative for 25 per cent of the years. At the same time, this seems like a big number, but the same data shows that crashes do typically recover over time. According to Ben, many stocks may enter negative territory throughout the year, while finishing with positive returns.
“The thing is, while every crisis is unique, scary narratives and market crashes – and subsequent recoveries – are as old as financial markets themselves,” he explains.
So, how do you invest in uncertain times? Follow these tips to help build resilience in your portfolio.
Don’t panic over headlines
One of the key themes Ben notes is the idea of the ‘narrative’ and how decisively it can shape how we interpret facts. While being informed is always a good idea, do not immediately panic over what you hear in the news. Yes, consider the current situation and facts, but step back from the ‘now’ and look at the history. Remember, stock market crashes are expected to happen and have happened throughout time. This is not new, and history has shown that things will eventually get better.
Reassess your risk tolerance and plan accordingly
Financial plans are meant to stand through market volatility in the short term, but that doesn’t mean you shouldn’t make changes. Consider how you feel about your investments right now. Are you overly stressed, not sleeping at night and anxious? Consider reducing your risk and switching to a more conservative portfolio. On the other hand, if you're relatively unbothered and your goals are long-term, you might want to consider increasing your risk.
Diversify, diversify, diversify
One of the best ways to build resilience in your portfolio at any time is to diversify it. There are many ways to do so, including investing across different countries, sectors, companies, and even investment styles. As Grandma always said: Don’t put all your eggs in one basket!
Investing is a long game
Investing is not a get-rich-quick scheme. Investing early on and keeping your money invested for as long as possible is the best way to grow your wealth. So, keep your emotions in check and don’t panic. The highest-risk investments should be for long-term goals, which means you have time for them to turn around and adjust if needed. Those who exit the market too quickly risk missing the rebound.
Final tips for investing in uncertain times
When it comes to your hard-earned money, it can be a bit tricky to step back from the ‘here and now,’ especially depending on the current narrative.
Here are a few more suggestions to help keep you cool and collected during volatile times.
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Do not check your investments daily. Trust the process.
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Keep on track: automate your investments to help remain focused on your goals.
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Speak to an expert if you are feeling overwhelmed, whether that’s a financial advisor or even a financial therapist. If you are feeling lost, professionals can help. Get in touch with a representative from PWL Capital to discuss your options.
