What to do with stocks now that markets are falling
The start of the trade war brought losses to most of the investors who invested their capital in company shares.
In a short period of time, the value of individual securities fell by more than 30%, and even well-diversified portfolios lost value as a result of this event.
For example, my investment portfolio of securities went into the minus by -6%, and only diversification with gold reduced the loss to -0.3%.
In this situation, most investors are asking themselves: What to do with stocks now that there is a global market decline?
Hold on to it in the hopes of a price recovery, or sell urgently to avoid even greater losses in the event of retaliatory tariffs on American goods.
There are several options for action in such a situation
Keep holding and don't make any sudden movements
From my considerable experience, I know that stock trading doesn't like sudden movements. If you don't notice the cause of a market decline in time, it's too late to act after the crash; it's better to wait for a recovery or at least a correction.
There's a high probability that markets will recover. This could happen for a number of reasons:
- President Trump will reverse his decision to increase tariffs on imported goods. He suggested this move in one of his speeches if the tariffs fail to achieve the desired results.
- Impeachment of the president, many of the major financiers are not happy with the fall and may initiate impeachment proceedings, which will lead to the resignation of the current president.
- The presidential election will change in four years, and new US elections will be held in 2028. The new president could easily repeal the tariffs.
This means that the market recovery will occur within a period of several weeks to several years, since there are currently no fundamental causes for the economic recession other than the new tariffs.
In addition, shares of companies that will not be affected by tariff increases, as they are focused on the domestic market, have also fallen in price.
Therefore, in the current situation, I would not rush to sell existing assets, locking in the losses incurred.
What to do with stocks – increase positions
As I mentioned above, not all stocks have objective reasons for falling; the following companies remain promising at the moment:
| № | Company | Ticker | Sector | Reason to buy now |
|---|---|---|---|---|
| 1 | Waste Management | WM | Services/disposal | Stable business in the US, not dependent on trade |
| 2 | Southern Company | SO | Utilities | Low risk, high dividend, domestic market |
| 3 | Dollar General | DG | Retail | Strong demand in a climate of economic instability |
| 4 | Lockheed Martin | LMT | Defense industry | Supplies under government contracts are not subject to tariffs |
| 5 | McKesson Corp | MCK | Pharma/distribution | Strong position in the US medical sector, sustainable logistics |
| 6 | American Water Works | AWK | Utilities (water) | Monopoly niche, stable domestic demand |
| 7 | Tractor Supply Co. | TSCO | Retail/agriculture. | Stable business for farmers, minimal impact of duties |
This is a good time to increase exposure to sectors such as pharmaceuticals, utilities, and telecommunications, as well as American companies operating exclusively in the US market.
A price drop is an opportunity to buy securities cheaper than their real value, but this must be done quickly before the price recovers.
Take up day trading
During periods of high market volatility, one of the best ways to make money is day trading securities. Leverage allows for significant profits on short-term trades.
Trading is conducted through stock brokers , which reduces the commission for opening trades to a minimum.
Another advantage of this type of trading is that it allows you to open short positions , which is especially important in a falling market.
When answering the question "What should I do with stocks now?", choose the option that best suits you:
- If you are a long-term investor, just wait it out
- If you have the funds, take advantage of the fall and buy shares
- If you want to make money quickly with a small capital, choose day trading stocks
