Average retail investor more than £8,000 better off by staying the course after Trump’s ‘Liberation Day’ market shock

Average retail investor more than £8,000 better off by staying the course after Trump’s ‘Liberation Day’ market shock

• New analysis from investment platform Lightyear shows long-term retail investors would be £8,000 better off compared to those who sold their shares following Trump’s shock tariff announcements

• The FTSE 100 fell 11% in the days following ‘Liberation Day’, but in mid-September the Index is 7% higher than April 1

• UK stocks that saw dramatic dips have now bounced back and exceeded pre-Liberation Day values, including Fresnillo (+130%) and Babcock International (+58%)

In the week of President Trump’s visit to the UK, new research from investment platform Lightyear shows that the average retail investor would be £8,000 better off today if they had resisted the temptation to sell their shares when markets fell after the President’s ‘Liberation Day’ tariff announcements.

Despite an initial downturn in global markets after Trump’s April 2 announcements, investors who held their nerve and kept their money in stocks and shares will have seen their portfolios grow, with average investments now exceeding pre-Liberation Day levels.

Patience pays off on both sides of the pond

In the UK, the FTSE 100 fell significantly in the week following Liberation Day. However, Lightyear’s analysis reveals that closing prices on September 15 were 7% higher – at 9,277 – than they were on April 1 before Trump’s announcement.

This means that an investor with an average Stocks and Shares ISA value of £46,000 will have seen the value of their investment rise to more than £49,200 between April 1 and mid-September.

Conversely, nervous investors who pulled their money out at the market’s lowest point after Liberation Day would have seen the value of their investment fall by 11% to £41,000. Investors who stayed the course, therefore, would be more than £8,000 better off.

A similar pattern emerged in the US. The S&P 500 has gained 17% from the day before Liberation Day to September 15, despite a dip of 10% in the week immediately after.

While investors may rightly have been nervous amid market turbulence, the data shows that patience pays off. In the UK, it took markets around six weeks (May 16) to exceed pre-Liberation Day levels, while in the US the S&P 500 outgrew pre-downturn levels just four weeks later on May 2.

Stocks to stick with

Lightyear’s research also highlights the standout UK stocks that have seen the biggest jumps from before Liberation Day to mid September, including Fresnillo (+130%), Entain (+51%), Babcock International (+58%), and Rolls Royce (+47%).

While Fresnillo’s stock price fell 12% in the week following the tariff announcements to £8.34 on the FTSE100, it has since regained to reach a closing price of £21.95 on September 15.

Similarly, Babcock investors saw an 11% dip following Liberation Day, dragging the share price down to £6.56 on April 7, but in the months since, prices have bounced back to exceed original levels at £11.67.

Wander Rutgers, UK CEO of Lightyear, said: “The ripple effect of President Trump’s Liberation Day tariff announcements shows just how quickly politics can impact markets worldwide. While many retail investors felt the initial shock in April, those who stood their ground have benefited as the markets recovered. It’s a good reminder of how investing in the stock market requires resilience and perseverance. At Lightyear, we make investing simpler, fairer and more transparent, which is why we recently made our Stocks and Shares ISA commission-free, to help retail investors build long-term wealth as easily and affordably as possible.”

About the data

• The average Stocks and Shares ISA value of £46,000 is calculated using HMRC data. The latest Annual Savings Statistics show that in 2022.23, £430,775bn was stored in Stocks and Shares ISAs and PEP Funds.

  • Meanwhile, data from the FCA shows that 17% of UK adults have a Stocks and Shares ISA, equivalent to 9.3m people. This gives an average value of a stocks and shares ISA of £46,319 (assuming each adult only has one S&S ISA account).

• Lightyear analysed S&P and FTSE 100 closing prices on April 1, one day before “Liberation Day” and contrasted data with closing prices on September 8, as well as their lowest point in the week following the tariff announcements from the US (April 7).

  • The assumptions in this PR rely on the average retail investor investing their cash in a FTSE 100 or S&P 500 tracker. All investment figures are rounded to the nearest thousand.

  • FTSE closing data was gathered from the London Stock Exchange. 

  • S&P data was gathered from Investing UK.