Trade Tensions Return: Why Diversification Still MattersJosh Gilbert, Market Analyst at eToro
Dubai, United Arab Emirates – May 30, 2025
In typical Trump fashion, yesterday’s tariff saga delivered another round of political theatre. Legal noise around the use of emergency powers and court rulings on the legitimacy of the tariffs had investors scrambling for clarity.
The initial rally in US equities yesterday, particularly the Nasdaq, showed the response we’re likely to get in markets if the end of the trade war is in sight. Yesterday, though, was once again a stark reminder of how policy can change at the blink of an eye and why investors should continue to manage risk during this time. This isn’t a signal to abandon safe havens or pile headfirst into risk; it’s a reason to stay diversified.
Josh Gilbert, Market Analyst at eToro, remarks that while the appeals court has allowed tariffs to stay for now, the legal battle is far from over. The White House is taking its case to the Supreme Court and weighing other legal options, which, to be frank, are unlikely to be quick or straightforward. This uncertainty adds yet another layer of risk for investors.
What we’re seeing is just another example of today’s current market conditions and how news flow, especially from a political standpoint, is injecting volatility into markets. Whether you’ve been investing for 10 weeks or 10 years, this is a tricky market to navigate. This constant policy whiplash is beginning to leave investors sore, and therefore, it’s important to cut through the noise and focus on long-term goals. Diversification and a clear strategy remain the best tools for navigating this policy-driven turbulence.
