It’s worth pausing to reflect on what has been an exceptional period for global equity investors.
The world’s leading stock market index has delivered three consecutive years of above-average returns:
2023: +24%
2024: +23%
2025: +16%
With long-term equity returns historically averaging around 8–10%, this kind of run is something to acknowledge, and to be grateful for.
At the same time, periods like this often bring an understandable question to the surface:
“ What happens next? ”
It’s a natural reaction. But it’s also where a well constructed financial plan quietly proves its value.
Learning from Recent Experience
This time last year, we spoke with many clients about the possibility that downside volatility could return after two strong years, and it did.
Tariff concerns triggered a sharp market decline during March and April 2025, testing investor resolve worldwide. Markets recovered strongly later in the year, and those who stayed the course benefited from that recovery.
We enter 2026 with the same mindset.
Your portfolio is already designed around:
Your long-term goals
Your capacity to tolerate temporary declines
The understanding that market setbacks are not failures, they are features of investing
Making changes based on how markets might behave in the short term isn’t financial planning. It’s speculation.
Market History in Perspective
This chart shows annual global market outcomes over time. What it highlights clearly is that positive years significantly outnumber negative ones, even though negative years tend to feel more dramatic when we’re living through them.
The long-term pattern is consistent:
- Periods of strong returns are normal
- Periods of decline are normal
- Attempting to jump between the two has consistently damaged investor outcomes
The irony of good preparation is that it often looks like doing nothing.
The financially literate understand this, and find peace in it.
Understanding the Current Moment
After three above-average years, many investors are asking whether markets are now “overvalued.” It’s a reasonable question.
Unfortunately, it’s also one that nobody can answer with certainty.
What history does show is that markets tend to revert toward long-term averages over time. This isn’t pessimism, it’s simply how markets work.
Extended periods of strong returns are often followed by:
- More modest growth, or
Temporary declines that bring valuations back into line.
Importantly, normal does not mean predictable.
We don’t know:
- When a period of below-average returns might begin
- What might trigger it
- How long it might last
This uncertainty is precisely why effective financial planning focuses on preparation rather than prediction.
Standing Ready with Confidence
Whether 2026 brings continued gains or a temporary setback, your long-term trajectory remains unchanged.
Market declines, when they occur, have always been temporary. The long-term growth of the world’s leading businesses has been permanent.
Your role as an investor is not to forecast the future, but to remain invested through it.
The experience of 2025 served as a reminder that this disciplined approach works.
We remain confident in the wealth-building power of owning shares in high quality global companies, businesses that continue to innovate, adapt, and grow regardless of the headlines dominating the news cycle.
Cash First, Investments Second
Rather than making portfolio changes in anticipation of possible declines, a simpler and more reliable discipline remains key:
- Ensure you have sufficient cash available for known short-term spending
- Avoid being forced to sell investments at an inopportune time
- Allow long-term investments to do what they are designed to do — compound over time
Beyond this, long-term investments should remain exactly that: long-term.
What We Can’t Know, and Why That Matters
Market leadership is currently concentrated in technology and AI-related companies.
Disappointing earnings could certainly shift sentiment.
Yet the decline we experienced in early 2025 was driven by tariff concerns, something few were discussing a year earlier.
The trigger for the next market downturn is almost always different from what investors expect. Decades of evidence show that attempts to time exits and re-entries consistently undermine long-term returns.
This is why robust financial planning focuses on resilience, not forecasts.
Moments like this naturally bring us back to one of the most important financial planning questions:
“ What does “enough” look like for you? “
When wealth is clearly linked to:
- The life you want to live
- The freedom you want to protect
- The security you want to feel
Market movements become context — not commands.
If This Way of Thinking Feels Familiar
You may be reading this without an existing financial plan, or with one that feels overly reactive, overly technical, or disconnected from the life you actually want to live.
At Wells Gibson, our approach starts with clarity rather than prediction. We focus on defining what “enough” really means, building resilience into plans, and helping people stay aligned through changing markets and changing lives.
If this resonates, it may be worth exploring what a calm, planning-led approach to wealth could look like for you.
If reading this leaves you feeling reassured, that’s often a sign your plan is doing its job.
If it leaves you with questions, about cash, risk, timing, or what “enough” really means for you, that’s worth exploring too.
Whether you’re reviewing an existing plan or considering a planning led approach for the first time, our team are always happy to have a thoughtful conversation.
Risk Warnings
This article is provided for information and educational purposes only and does not constitute personal financial or investment advice, nor a recommendation to engage in any investment strategy.
The content reflects views at the time of publication and may change. References to market performance or behaviour are for illustrative purposes only, and past performance is not a reliable indicator of future results.
The value of investments and any income from them can fall as well as rise, and you may not get back the amount invested. Markets are volatile and unpredictable, and no strategy can eliminate risk or guarantee outcomes.
This article does not take account of individual objectives, financial circumstances, or tolerance for risk and should not be relied upon when making investment decisions. Regulated financial advice should be sought where appropriate.
Wells Gibson Limited is authorised and regulated by the Financial Conduct Authority (Firm Reference Number 731027).
