During times like these when geopolitical headlines can be unsettling for investors, we like to remind ourselves of one of our key investing principles. Markets have always faced challenges —ranging from geopolitical conflicts and economic downturns to natural disasters, political upheaval and health crises. These events often trigger short-term volatility and shake investor confidence. However, historical data shows that stock markets have demonstrated a tendency to comeback after each crisis and rise over the longer time horizons. This patten underscores the importance, for strategic investors, of maintaining a long-term perspective – even when the near term outlook feels very uncertain.
Consider this: the likelihood of positive returns in the stock market increases significantly with time. While short-term performance can be unpredictable, the probability of gains may improve over longer holding periods. Over any one-year period, the market may be up or down, but over rolling 15 year periods since 1950, each such period has ended positive. While past performance is no guarantee of future results, the odds have historically favored long-term investors who are able to ride through the ups and downs and stay invested. A strategic time horizon is a key advantage long-term investors have over short-term traders and asset managers benchmarked every quarter.
Historically Longer Holding Periods Have Exhibited Increased Likelihood of Gains
Source: LPL Research, Bloomberg 05/30/25
This long-term growth in markets has been driven by the fundamental strength of the economy, innovation, and companies’ ability to adapt and thrive over time, something that we believe has a good probability to continue. A simple investment of $10,000 in the , left untouched for 30 years, has historically grown many times over, though past performance does not guarantee future results.
Looking Back, Strategic Investors Have Been Rewarded for Their Patience
Source: LPL Research, Bloomberg 05/30/25
After examining the gains that a stock investor reaped over those 30-years, an uneducated observer could be forgiven for assuming that those years must have provided smooth sailing with few disruptive events. Far from it! If we add an overlay of geopolitical events on to the S&P 500 chart for the past 30 years, it’s clear that stocks rose despite multiple terrorist attacks, multiple wars and escalations in the Middle East, and the start of a ground war in Europe (Russia/Ukraine). Not only this, but this period also contains multiple financial crises, numerous contentious elections, “Brexit” and even the COVID-19 global pandemic. As with other time frames over the past century, despite countless disruptions and bouts of volatility that they have caused, the stock market has demonstrated remarkable resilience. Strategic long-term investors who stayed the course through these turbulent times may have been rewarded with compelling long-term returns.
Over Longer Time Horizons, S&P 500 Stocks Have Tended to Shrug Off Geopolitical Concerns
Source: LPL Research, Bloomberg 06/16/25
Conclusion
Although the future is never guaranteed, historical trends suggest, in our view, that patience has often been a virtue for Investors who remain disciplined, diversified, and focused on their long-term goals may be better positioned to navigate market turbulence effectively. While it’s natural to feel uneasy during periods of uncertainty, history reminds us that have comebacks have often tended to follow crises and that stock markets have tended to show resilience over the longer-term time horizons. In investing, for those who have it, time is the greatest ally.
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Important Disclosures
This material is for general information only and is not intended to provide specific advice or recommendations for any individual. There is no assurance that the views or strategies discussed are suitable for all investors. To determine which investment(s) may be appropriate for you, please consult your financial professional prior to investing.