Why This Market Dip Could Be Your Opportunity — and Why Waiting Might Cost You
We know how unsettling the recent market pullback feels. Portfolios are down, screens are red, and it’s tempting to wait for the “all-clear” signal. You’re asking yourself: should I buy now, or wait until I feel safe? The truth is, moments like this, when fear is high, are often exactly when opportunity appears.
Corrections happen — and historically, they reward patience
Let’s start with the data. According to State Street Global Advisors, “after 10% or greater drawdowns, equities have historically delivered positive average returns over all subsequent periods” (SSGA, 2025). They point out that these 10%+ declines have occurred 25 times since 1928, yet subsequent 3-, 6-, 12-, and 24-month returns were positive in the majority of cases (SSGA, 2025).
LPL Research reinforces this: “following recoveries from stock-market corrections of 10–20%, double-digit gains over the next 12 months have been commonplace” (LPL, 2025). Roughly 70% of corrections since 1950 were followed by double-digit gains within a year (LPL, 2025).
What we want you to take from this is simple: corrections are not rare; they are normal. And historically, they have rewarded those who stay engaged.
Markets are built to recover
You might worry this time is different. But research suggests otherwise. A study in the Journal of Empirical Finance found that “stock markets in all five countries exhibit a significant bounce-back effect after bear-market troughs” (ScienceDirect, 2014).
Even more compelling, a global study covering 71 countries from 1830–2019 concluded: “We document a strong and robust long-run reversal effect… past poor long-term returns tend to predict higher future returns” (ScienceDirect, 2019). In other words, markets are wired to recover, even after prolonged weakness.
The Federal Reserve adds a behavioural perspective: “Periods of negative sentiment frequently lead investors to overreact, creating short-term mispricings that subsequently reverse” (Federal Reserve, 2025). So while fear makes you hesitate, it also creates opportunity.
Valuations and fundamentals are working in your favour
Even with recent declines, valuations are more attractive than they’ve been in years. Morningstar notes that the US market has been trading below its fair-value composite, with growth-heavy segments seeing the sharpest repricing (Morningstar, 2025).
BlackRock’s insight is clear: “Drawdowns create entry points that tend to improve long-term return potential when fundamentals remain intact” (BlackRock, 2025).
MSCI reinforces this, noting that “periods of elevated volatility are often followed by periods of above-average returns as risk premia reset” (MSCI, 2025).
In short, the conditions are aligning for those willing to act strategically.
Your biggest risk may be hesitation
We know it’s hard to act when your portfolio is down. CFA Institute puts it bluntly: “Missing just the 10 best days in the market over a 20-year period can cut total returns by more than half” (CFA Institute, 2020).
Waiting for markets to feel safe can cost you far more than stepping in when it’s uncomfortable. Volatility is the price of opportunity. Fear is what creates the discount.
What you could do now — a practical game‑plan inspired by smart money
If you are reading this and feeling the tension, “buy now and risk falling further, or wait and risk missing a rebound?” — here’s a reasoned path forward, informed by both the data and what a top allocator is doing.
1. Consider selectively aligning with smart‑money tech/AI exposure
Ken Griffin has recently increased his stakes materially in high‑profile technology and AI‑levered companies. For example, in Q3 2025 his firm boosted its stake in Microsoft by about 100 %, making it one of the largest holdings in the portfolio. He also significantly increased positions in Meta Platforms and Apple.
If you believe, as many do, that AI, cloud infrastructure, enterprise software, and next‑gen services, remain a long‑term structural trend, aligning a portion of your portfolio to a similar basket may make sense. That way, you ride potential structural growth while benefiting from today’s “discounted” entry prices.
2. Avoid overconcentration: blend growth exposure with offsetting stability or hedges
The smart‑money shift is not only about loading up on tech. For example, Griffin’s Citadel also added a position in the ETF SPDR Gold Shares (GLD) in the same quarter. (Nasdaq) This suggests a hedged approach: participating in upside while acknowledging macro or valuation risk with a non‑correlated asset.
If you take a similar tack, you avoid the risk of being “all-in” on high volatility, instead, you build a balance: growth potential from tech/AI stocks, stabilisation or hedging via assets like gold or other ballast holdings.
3. Build a time‑horizon conscious allocation and avoid overtrading
Given how often equities have recovered from drawdowns historically, having a multi‑year horizon can smooth out the noise. Short-term volatility can rattle nerves and trigger emotional decisions, which often cost more than they save.
If you enter now with a diversified allocation, you give time for:
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structural themes (AI, cloud, digitisation) to unfold;
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market-wide valuations to normalise;
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macro risk (rates, inflation, sentiment) to resolve without forcing a decision.
4. Treat this as a “staged entry” rather than all-or-nothing
You may not want to commit all funds at once. Instead, consider deploying in tranches: buy a portion now, while valuations look depressed, hold, then add more if the market dips further or fundamentals stay intact. This reduces the risk of mistiming the bottom and benefits from average cost basis over time.
5. Monitor fundamentals and macro indications but don’t chase every headline
Your allocation should always stay tethered to business fundamentals: earnings outlook, balance sheet health, competitive advantage, not just market euphoria. Drawing from institutional behaviour: even as Citadel loaded up on tech, they hedged with gold. That’s a reminder that good investing isn’t about following hype blindly, it’s about risk‑aware conviction.
