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Volatility is a Feature, Not a Bug
A sudden drop or spike in the stock market might feel like a glitch in the moment, but volatility is very much a feature of the market, not a bug. Between 2001 and 2025, only three years lacked any single-day swings of plus or minus 2% in the S&P 500. More than half of those years saw 10 or more single day +/-2% swings. Volatility can't be an outlier if it happens a majority of the time.¹
Just think about all the things that can make the markets volatile: Monetary policy, company earnings, trade, war and conflict, unemployment, inflation... a tweet. When President Trump posted the threat of 100% tariffs on China on social media in October, the stock market had its worst day since his first major tariff announcement in April. The S&P 500 was down -2.7%, the Nasdaq Composite dropped -3.6%, and the Russell 2000 Index declined -3.0%.2 Yet it rebounded quickly.
Ultimately, volatility usually stems from uncertainty about what affect certain policies or events might have on the economy. And just like uncertainty is a guarantee in investing, so too is volatility a guarantee in the market.
From 1928 to August 2023, the S&P 500 Index had 859 moves of at least -2% and 769 moves of at least +2%, an average of once every 29 and 33 trading days, respectively.3 But volatility gets a bad rap: It's not always a bad thing. Amidst all this volatility, the S&P 500 has returned a cumulative 25,425%.3
Since it's impossible to know in the moment (or ahead of time) if a spike in volatility marks the beginning of a market reversal or merely a temporary blip, longstanding investing advice says the best course of action for maximum returns is to stay invested through the turbulence. But there is an investment strategy we recommend that goes beyond surviving volatile markets by harnessing them instead. It starts with assuming that volatility will happen. That volatility is a feature, not a bug.
The TrueShares TrueOutcome series of ETFs aim to achieve capital appreciation with the potential for reduced volatility compared to the U.S. large-cap equity market by holding strategic options. Going one step further, our TrueShares Quarterly Bull Hedge ETF (QBUL) and Quarterly Bear Hedge ETF (QBER) take advantage of substantial increases and declines in the market, respectively, by leveraging options for potential gains in both scenarios.
Options only have value when the underlying asset is volatile above or below a predetermined, or strike, price.4 Therefore, options can be very beneficial additions to portfolios during times of volatility. And since volatility is a feature of the market, it might just as well always be a good time to hold options.
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Sources & Disclosures:
- https://www.blackrock.com/us/financial-professionals/insights/navigating-volatility-learning-from-history
- https://www.linkedin.com/posts/raymondjamesinvestmentmanagement_markets-in-focus-october-13-2025-ugcPost-7383585869837950976-huK4/
- https://www.fisherinvestments.com/en-us/resource-library/market-cycles/volatility/in-perspective
- https://www.investopedia.com/ask/answers/010915/volatility-good-thing-or-bad-thing-investors-point-view-andwhy.asp
Performance presented is past performance, and does not guarantee future results. There is no assurance theTrueOutcome ETF investment process will consistently lead to successful investing. The funds buy and sell options which are speculative activities and entail greater investment risks. Please click each Fund link for more information the fund including risks.
One cannot invest directly in an index.
S&P 500 Index: A market-capitalization-weighted stock market index that tracks the performance of 500 of the largest publicly traded companies in the United States.
Nasdaq Composite Index: An electronic stock exchange of over 3,300 companies, with a strong representation of technology and growth-oriented companies.
Russell 2000 Index: A stock market index that tracks the performance of approximately 2,000 small-cap U.S.companies.
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