Long-term investors should largely ignore short-term geopolitical turmoil, according to the latest UBS Global Investment Returns Yearbook. Historical data spanning 126 years shows that major conflicts like world wars had significant market impacts, but peacetime bear markets often caused more damage. For instance, Irish stocks lost 81% in 2008.

The US benefited enormously from fighting wars on its own territory, as seen in superior returns compared to Germany and France during both world wars. US rail stocks returned $176,000 per $1 invested since 1900, far outperforming trucking ($27,000) and airlines ($8,000), demonstrating the value of holding cost-efficient, productive industries. Technology stocks took 17 years to recover after the dotcom bubble, yet investors who stayed diversified within the sector eventually outperformed the broader market. The Yearbook also warns against hoarding gold, which offers only modest long-term returns and high volatility; it performs best during crises but is a poor inflation hedge. Instead, investors should buy gold when markets are strong and sell during downturns to rebalance portfolios.