Market Volatility as Opportunity: A Wise Investor's Perspective

Mar 5

After years of relatively low volatility and impressive market growth, we are now entering a new phase—one marked by increased uncertainty and market fluctuations. While this shift may feel uncomfortable, it's important to recognize that volatility is an inherent part of investing and often presents opportunities for those who are patient, disciplined, and prepared. As you know, at Riggs we have a deep bench of experience in the investment markets having invested during the last 70 years. We bring that long-term perspective to bear during periods of market volatility.

Understanding the Current Market Pullback

Over the past few years, low volatility combined with significant fiscal stimulus and the breakthrough advancements of artificial intelligence contributed to an extended period of market strength, particularly in the S&P 500. However, as 2025 begins, we are encountering the natural ebbs and flows of the markets once again.

The recent pullback in the S&P 500, with strong support levels at 5,800 and 5,700, is well within the normal range. On Tuesday, the market dipped to 5,732.59 before recovering to close at 5,842—a sign that critical support levels are holding. While the market is slightly down year-to-date, no significant technical or fundamental breakdowns have occurred as you can see from the chart below.

S&P 500 Large Cap Index from StockCharts.com — *Courtesy of Helene Meisler*

It's easy for short-term volatility to feel overwhelming after an extended period of calm, but as seasoned investors know, maintaining a long-term perspective is critical. We review technical charts weekly to identify trends and ensure that we remain diligent in monitoring the health of the markets.

Finding Opportunity Amid Volatility

Periods like this allow us to reevaluate and capitalize on opportunities to strengthen portfolios. Despite the recent turbulence, several areas of the market are showing great promise and long-term upside potential. Here are the key areas we’re focusing on:

1. Gold as a Hedge Against Uncertainty

Gold is a compelling asset in today’s environment for several reasons. It serves as a volatility hedge, an inflation hedge, and a counter to a weak dollar. We’ve been incrementally adding to our gold positions, believing that this asset will provide both stability and a potential for growth as it dampens overall portfolio volatility. Bob Graham, President, Riggs Asset Management, recently talked about our investment in gold in this most recent video. Click here.

2. Financials Regain Momentum

While lagging for much of the previous bull market, financials are beginning to show signs of life and renewed strength. Policy shifts and economic conditions are creating new opportunities here, and we are strategically increasing our exposure to this sector.

3. International Markets Resurface

After years of U.S. market dominance, we are now seeing intriguing opportunities abroad. While we remain confident in the U.S.’s long-term economic strength, policy changes and valuation disparities make select international markets attractive. Thoughtful exposure to these areas can provide diversification and additional growth potential.

4. Selective Healthcare Plays

Certain segments within the healthcare industry also are looking appealing. Advances in technology and ongoing demographic trends are creating pockets of growth, and we are carefully reviewing opportunities in this space.

Maintaining Perspective

It’s natural to feel uneasy during periods of increased volatility—especially following years of market calm. However, it’s essential to note that this pullback is not abnormal. Markets operate in cycles, and these moments create opportunities to invest in high-quality companies at discounted prices.

By staying focused on fundamentals, maintaining a steady hand, and reviewing technical indicators regularly, we can help ensure portfolios are well-positioned for recovery and growth when conditions stabilize.

Confidence in Strategic Action

At Riggs Asset Management, we remain committed to a disciplined and prudent investment approach. Rest assured that we are carefully monitoring the markets, reviewing data, and positioning portfolios in ways that align with our clients’ long-term goals.

If you have concerns about the current market environment or would like to discuss your portfolio in more detail, we’re here to help provide clarity and guidance.

Volatility, while unnerving, offers opportunities for strategic action. Let's seize them wisely.

Bob Graham discussing investment strategies. — *Bob Graham, President of Riggs Asset Management, discusses why we have invested in gold for approximately two years. Click image to view.*

Reach out to your advisor or contact us directly to schedule a consultation. Together, we can review your portfolio, address your concerns, and ensure your strategy remains aligned with your long-term financial goals.

Tracey Selingo

Tracey Selingo is the founder and chair of Fork Over Love, a 501(c)(3) organization devoted to increasing food security with dignity and grace. She spends her time helping people move the world they carry on their shoulders underneath their feet because she knows that when you’re standing on top of the world, everything is possible.