Fear or opportunity?
Nvidia at $149 = everyone loves it
Nvidia at $107 = no one wants it
Palantir at $124 = everyone loves it
Palantir at $75 = no one wants it
Meta at $736 = everyone loves it
Meta at $597 = no one wants it
Investor psychology is always fascinating.
Just a month ago, everyone was throwing money into stocks without hesitation.
And then the market hit a patch of uncertainty due to tariffs…
Market uncertainty isn’t anything new. If you study markets you know that it's historically created some of the best buying moments.
Here’s a quick rewind of market crashes/dips triggered by uncertainty:
2023 bank failures – People genuinely questioned if the entire banking system was on the edge of collapse after Silicon Valley Bank went under.
The COVID pandemic – It felt like the financial world was imploding and holding cash seemed like the smart bet.
2019 trade war – Somewhat similar to what’s going on now.
2008 housing crisis – The entire financial system was at risk and investors were convinced the market would never recover.
These events were real. They created legitimate fear and forced people to question everything they thought they knew about investing.
But here’s what history shows:
Each time when fear is at its highest, the market dips to levels assuming the absolute worst: businesses failing, economies collapsing, or no positive way forward.
And yet, companies adapted, governments adapted, economies adapted, and markets recovered.
Those who stayed in the game? They got rewarded with higher returns.
It’s counterintuitive, but moments like these (when uncertainty and fear is at high levels) are often the best times to continue to invest.
The same stocks people were rushing to buy a month ago are sitting at lower prices.
Yet, many are waiting on the sidelines for “clarity” or for “the trend to reverse" while hedge funds and institutions are likely scooping up stocks at a discount.
If you wait for uncertainty to disappear, you’ll be buying when everyone else is: at new all-time highs.
“The four most dangerous words in investing: This time it’s different.” — John Templeton
Risk can never be fully eliminated in the markets.
People try to eliminate it but what they usually do is end up eliminating their returns instead.
We cover this in depth in The Art of Diversification module in Money Mastery: Too much diversification can be just as harmful as too little.
The reason we earn returns is because we invest despite uncertainty and risk.
If the future was certain, everyone would invest and market returns would be flat since there’d be no risk to reward.
Investors put their money into companies because they believe those businesses will adapt, grow, and keep making money despite short-term setbacks. The S&P 500 has a solid track record of doing just that.
If an S&P 500 company stops adapting? It gets booted and replaced by one that is.
For example: DoorDash, TKO Group, Williams Sonoma, and Expand Energy are soon to be added to the S&P 500. Meanwhile, BorgWarner, Teleflex, Celanese, and FMC are getting kicked out.
That’s why I keep the S&P 500 as a core position in my portfolio. It’s self-cleansing and constantly adjusting to the business environment.
That gives me the foundation to take riskier investments or business moves knowing I have something to fall back on.
Now let’s think about some of the biggest companies today:
Many of them are trading at a discount compared to just a month ago.
Yet despite that:
Costco is still packed with shoppers.
Meta is still pulling in billions in ad revenue.
Nvidia is still building the backbone of AI.
The truth? Wealth in the markets isn’t disappearing.
It’s transferring to those who stay in the game.
That just won’t be obvious until greed and market optimism returns.
Investors who stay in the game despite all of the noise get rewarded with higher returns over time.
But most don't see that because they're trying to get rich tomorrow.
Every market dip gives you a choice:
Do you get blinded by the fear or do you see the opportunity it creates?
It’s not about denying uncertainty. That’s always going to be there because the future is always uncertain.
The real question is what will you do about it?
Will you spot the opportunity despite the fear (like billionaires and hedge funds do) or will you cave to it?
Only one of those options will improve your financial future.
If you want to learn more about how to build an investing system that you can stick to through every market cycle, join my Money Mastery program.
