There will be many people reading this article who are already aware that over the last few years many funds invested in the US should have seen a good return, and at the beginning of this year saw a lot of market volatility.
A quick way to see the returns is to look at the performance of the ‘Standard and Poor’s 500’, more commonly known as the S&P 500. This tracks the stock performance of 500 leading companies listed on stock exchanges in the United States. Over the last 9 years the index has risen significantly, opening at 2091.75 on the 13th June, 2016 and closing on the 12th June, 2025 at 6039.72. This means if you invested in a tracker or passive fund that tracks the S&P 500, this is the growth you should have enjoyed before charges.
But I think this is where many people make mistakes and tend to forget what I believe are the fundamental principles of investing which include, never have all of your eggs in one basket, and not to encash when the market is low. I am not saying you should not invest in this area but consideration needs to be given with how much. Recently we have seen individuals with large US holdings, who encashed their holdings when they were low, due to the volatility.
The S&P had the fifth worst start to the year in the S&P 500 history and was down 10.2% in the first 73 trading days1. Although it has now recovered2, it did fall to 4982.77 on 8th April, 2025 after reaching a record high on 19th February of 6144.15, a drop of nearly 18.9%.3
So before investing in this sector or any sector, I think you have to ask yourself, mentally could you cope with a drop in your investments like this and what percentage of your investment would you want subject to this? Nobody can be sure that the market will go back up and even how long it could take, in fact 2000, 2001 and 20024 the S&P had negative returns.
As I have said previously, I always see our main role as a sounding board and we are able to hold clients’ hands through the difficult times. If you would like to review your investment, why not pick up the phone today and ask for a free without obligation consultation.
1Voroni 1st May, 2025
2Open 2nd Jan, 2025, 5868.55 closed 12th June, 2025, 6039.72
3CNN Business News
4Slick Charts.com
The value of investments can go up as well as down and you may receive back less than your original investment. Past performance is no guarantee of future results