Iran War Tests Investors. How To Navigate Stock Market Trading Risks During Global Conflicts When a crisis such as the Iran war breaks out, investors' emotions can run wild. Fear of financial losses and the fog of war cloud stock market trading decisions. How can investors handle the latest conflict and its unpredictable moves? Geopolitical shocks are times for investors to summon the nerves of a warrior and stay with the rhythms of the stock market — not necessarily each day's results, investing veterans say. Rather than try to keep up with headlines from distant battlefields, the playbook for crisis investing is as close as your trading screen. Studying the behavior of the major market indexes and leading stocks provides the best way to navigate storms, as it does in any environment, experts say. "Investing based on geopolitics is a losing proposition," said Paul Schatz, president of Heritage Capital in Woodbridge, Conn., in a note to clients. Even with signs foreshadowing the U.S.-Israel attack on Iran, it was difficult to gauge market reaction. "It's no different than Nvidia's earnings, which I thought would blow out," Schatz said. "Yet, I had no idea how the stock would react." History shows that markets can overreact when a new crisis starts. But they usually calm themselves and return to the prevailing trend that existed before the crisis. Wars typically don't cause bear markets. The Yom Kippur war of 1973 and the 9/11 terrorist attacks in 2001 occurred while the S&P 500 was already in a bear market. Neither crisis did anything to turn the market around. A table detailing the S&P 500's performance after key geopolitical events reveals that while short-term volatility is common, long-term trends often persist. For example, the Cuban Missile Crisis in 1962 saw the index rise 5.10% in one month and 27.#iran #israel #s_p_500 #u_s #george_smith
