Amid the U.S. war with Iran, some young investors have gotten their first taste of market volatility.
“An early decline can make the market feel unusually dangerous when volatility is a normal part of long-term investing,” said certified financial planner Douglas Boneparth, president and founder of Bone Fide Wealth, a wealth management firm in New York City.
“It can be unsettling because they don’t yet have the experience of living through prior downturns and recoveries,” Boneparth said.
Since the war in the Middle East began on Feb. 28, the S&P 500 has seen daily drops of more than 1.7% and daily gains higher than 2.5%, according to data from Morningstar Direct. Stocks have fared slightly better since the U.S announced a two-week ceasefire on April 7.
Still, within the first month of the war, the S&P 500 shed more than 7%. An initial investment of $10,000 in the index on Feb. 28 would have dropped to around $9,260 by March 29, Morningstar Direct calculated.
