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Volatility Survival Guide
Wisdom from 50 Years of Investing

Chris Davis on how this guide can help you tune out the noise and build long-term wealth

Chairman & PM Chris Davis (0:38)

01

“Sitting in cash” can be a dangerous strategy.

Value of $100 after inflation: 2000-2024

  • Cash is constantly eaten away by inflation
  • Stocks (your share of actual businesses) can grow wealth faster than inflation

Cash vs. Stocks

Source: Davis Advisors. Illustration of a hypothetical investment in the S&P 500 Index.
Past performance is not indicative of future results.

02

Corrections are inevitable.
Remain calm.

Frequency of Market Downturns 1928-2024


Source: Ned Davis Research as of 12/31/2024. The market is represented by S&P 500 Index.
Past performance is not indicative of future results.

03

Tune out today’s noise. Think long term.

Percent of Time Stocks Were Positive Over Various Holding Periods from 1928-2024

Daily: 53%
1 Year: 76%
5 Year: 88%
10 Year: 94%
20 Year: 100%

As of 12/31/24. Source Bloomberg.
Past performance is not a guarantee of future results.

04

“You make most of your money in a bear market, you just don’t realize it at the time.”

Shelby M.C. Davis

05

Disregard market forecasts.
Following them can hurt returns.

Chairman & PM Chris Davis (0:54)

06

“Far more money has been lost by investors trying to anticipate corrections than in the corrections themselves.”

Peter Lynch

07

Timing the market is a loser’s game.

$10k Investment in the Market Over the Past 20 Years

The market is represented by S&P 500 Index as of 12/31/24.
Investments cannot be made directly in an index.
Past performance is not a guarantee of future results.

08

Volatility is the fee to build long-term wealth.

Bestselling author Morgan Housel (0:45)

09

Tune out inevitable market gyrations

Monthly Percentage Change. S&P 500® 1990-2024

Source: Standard & Poor’s, Bloomberg, Thomson Financial and Morningstar.
The market is represented by S&P 500.
Past performance is not indicative of future results.

10

Stay the course through these gyrations to build long-term wealth

Growth of $10k in the Market 1990-2024

Source: Standard & Poor’s, Bloomberg, Thomson Financial and Morningstar.
The market is represented by S&P 500.
Past performance is not indicative of future results.

11

Crises are painful, inevitable but ultimately surmountable

$10k Investment in the Market 1970-2024

Chart represents performance of S&P 500® Index from 1/1/1970 to 12/31/2024.
Past performance is not indicative of future results.

12

Pulling It All Together:
Key Strategies for Surviving Volatility

  • Recognize that sitting in cash can be dangerous.
  • Understand that corrections are inevitable. Remain calm.
  • Recognize that bear markets provide opportunity for the long-term investor.
  • Disregard short-term market forecasts. Following them can hurt returns.
  • Don’t try to time the market — it’s a losers game.
  • Accept volatility. It’s the price of admission for building wealth.
13

More resources on successful investing:


Mastering the Mental Game of Investing

Chris and Morgan Housel discuss the keys to successful investing.

Wisdom of Great Investors

History’s best investment minds on building wealth.

Davis Video Library

Our PMs on the markets, top ideas and investment themes.

Before investing in the Davis ETFs, you should carefully consider the investment objectives, risks, charges, and expenses of the Funds. The prospectus and summary prospectus contains this and other information about the Funds. You can obtain performance information and a current prospectus and summary prospectus by visiting davisetfs.com or calling 800-279-0279. Please read the prospectus or summary prospectus carefully before investing or sending money. Investing involves risks including possible loss of principal.

This material includes candid statements and observations regarding investment strategies, and economic and market conditions; however, there is no guarantee that these statements, opinions or forecasts will prove to be correct. These comments may also include the expression of opinions that are speculative in nature and should not be relied on as statements of fact.

Davis Advisors is committed to communicating with our investment partners as candidly as possible because we believe our investors benefit from understanding our investment philosophy and approach. Our views and opinions include “forward-looking statements” which may or may not be accurate over the long term. Forward-looking statements can be identified by words like “believe,” “expect,” “anticipate,” or similar expressions. You should not place undue reliance on forward-looking statements, which are current as of the date of this material. We disclaim any obligation to update or alter any forward-looking statements, whether as a result of new information, future events, or otherwise. While we believe we have a reasonable basis for our appraisals and we have confidence in our opinions, actual results may differ materially from those we anticipate.

The graphs and charts in this report are used to illustrate specific points. No graph, chart, formula or other device can, by itself, guide an investor as to what securities should be bought or sold or when to buy or sell them. Although the facts in this report have been obtained from and are based on sources we believe to be reliable, we do not guarantee their accuracy, and such information is subject to change without notice.

We gather our index data from a combination of reputable sources, including, but not limited to, Lipper, Wilshire, and index websites.

The S&P 500 Index is an unmanaged index of 500 selected common stocks, most of which are listed on the New York Stock Exchange. The index is adjusted for dividends, weighted towards stocks with large market capitalizations and represents approximately two-thirds of the total market value of all domestic common stocks. Investments cannot be made directly in an index.

Peter Lynch is not associated in any way with Davis Selected Advisers, Davis Advisors or their affiliates.