Anchored Uncertainty

Concerns about tariffs, global economic uncertainty, the Federal Reserve, political warfare, and new all-time highs remain in the headlines. Add to that the continuing geopolitical tensions in the Middle East, Asia and Europe, and the picture can rightfully feel unsettling.

But uncertainty isn’t unusual. It is the rule, not the exception.

The last five years have been a masterclass in this reality. In just half a decade we’ve lived through a global pandemic, multiple wars, debt ceiling debates, political unrest amidst hardline partisanship, a Chinese spy balloon, two bear markets, surging inflation, recession fears, rising interest rates, and a steady stream of other “once-in-a-lifetime” crises. Each time, headlines warned of collapse with clear justifications. Yet, history shows a remarkable pattern: the market continues to adapt and move forward. It is its imperative.

This distinction matters because many investors often equate uncertainty with risk. In truth, risk is less about unexpected events happening and more about how we react to those events. Those are two very different things.

Today, the current “big” uncertainty is a mix of stretched valuations and rising geopolitical tension.

But as Peter Lynch reminds us:

“Far more money has been lost by investors preparing for corrections, or trying to anticipate corrections, than has been lost in corrections themselves.”

So where does this leave us? Are stocks at risk of falling? Of course – markets always carry that possibility. But the opposite risk also remains – that stocks can continue rising, despite persistent headlines to the contrary.

When the full range of outcomes is always in play, the question is not how to avoid uncertainty – but how to anchor ourselves within it.

This is where Nassim Taleb’s concept of being antifragile applies:

“Some things benefit from shocks; they thrive and grow when exposed to volatility, randomness, disorder, and stressors.”

In practice, being antifragile means having a financial plan that is built to anticipate uncertainty – and staying disciplined when uncertainty inevitably arises. As Charley Ellis put it:

“Benign neglect is the secret to long-term investing success. If you change your investment policy, you are likely to be wrong; if you change it with a sense of urgency, you’re guaranteed to be wrong.”

Using a “3-3-3” framework (three months cash, three to five years short-term, high-quality bonds, three decades in growth assets) is a good mental model. It creates stability for living needs, buffers against market downturns, and keeps the bulk in productive assets with a focus on aligned incentives.

Anchored uncertainty is not about eliminating the unknown. It’s about creating a disciplined strategy strong enough to weather it – and steeling ourselves despite it.