There are plenty of reasons to be uneasy about the Middle East these days. Higher oil prices continue to strain the global economy, international trade remains restricted, and the threat of a broader war persists.
Nearly two months into the current war with Iran, there's still no clear path out of the conflict. Like most geopolitical events, the timeline and outcome remain uncertain—it could last a few more weeks or extend much longer.
We've already seen more market volatility in recent weeks, and that may continue for a while. That part is normal. Markets tend to react quickly when uncertainty rises.
Still, it helps to step back and look at the bigger picture. And, to put things in perspective, consider US stock market performance from 1926 through 2025. During that nearly 100-year period, there were many wars—World War II, the Vietnam War, 9/11, and others.
Figure 1 shows the long-term growth of US stocks over time, through wars, military actions, recessions, and other periods of stress. The broader lesson is that markets have a long history of moving through difficult events and rewarding disciplined investors over time.
Figure 2 shows how US stocks performed after past military actions, spanning the initial three months, followed by 1-year and 3-year returns. The short-term results were mixed—stocks mostly rose over one year, and all 3-year periods were positive. This is a good reminder that, while volatility is always possible during major geopolitical events, markets don't always respond negatively following stressful periods.
Of course, none of that tells us exactly what the next year will look like. There are too many moving parts, and plenty of things that affect stock prices besides the current situation. But history does suggest that making investment decisions based on fear and intuition is usually not the best approach.
In my view, a disciplined approach with consistent stock and bond allocations remains the most reliable path to your long-term goals.
Source: Figures 1 and 2 are from the Avantis ETF Field Guide, February 2026. Data: US stocks from July 1926 - December 2025, Ken French Data Library, Indexes are not available for direct investment. Past performance is no guarantee of future results.