2025 Q3 Market Commentary

A Remarkably Calm Market… For Now 

I have tried to think of a clever way to start this commentary with a good quote, a song lyric, or a story to highlight what is going on in the markets and the economy, but nothing seems to fully capture what’s happening. By many statistical measures, things couldn’t be better.

At the end of the third quarter, the S&P 500 is at (or close to) an all-time high and up 14.5% overall for the year,^[i] international stocks are up over 26%,^[ii] gold is up around 50%,^[iii] Bitcoin is up 17%,^[iv] bonds are up over 6%,^[v] and even cash can still get close to 4%.

Even more surprising is how consistent the climb upward has been. Since the tariff craziness of April, markets have moved steadily upward with minimal volatility along the way. To highlight just how little volatility has been in the markets lately, consider the following numbers. From January through the end of April, the S&P dropped by over 1% on 19 of 81 trading days. But from May to the end of September, it fell by more than 1% on only three of 105 trading days. For added context, from 2020–2025, there were on average 35 days a year where the market fell by 1%, so we have experienced remarkable consistency over the last few months.^[vi]

Are there reasons to think that this lack of volatility might not continue? I don’t normally talk in absolutes, but the easy answer is “yes,” and not just because there must be. Remember that water finds its level. There are real reasons to believe that stocks might not continue to see a straight line up and to the right. This is not to say stocks will not end the year higher from where they are now. They might, I just find it hard to believe it will be without volatility in the meantime. Some of the biggest factors that could disrupt the calm:

• Government Shutdown – As I write this on October 22, the federal government has been shut down for 22 days. This makes it the second-longest shutdown since 1976. If it’s still shut down when you read this, then we are just days away from the record of 35 days. I hope that is not the case, and not just because I have upcoming travel. So far, the shutdown has not put the brakes on the markets or the economy, but that could change. The longer it lasts, the greater potential impact on confidence and spending.
• Re–Opening the Trade War – In early October, it looked as if the trade war with China might start up when the Chinese government announced new export restrictions on rare earth minerals. President Trump immediately announced plans to impose an additional 100% tariff on Chinese imports. He has since walked that back (kind of) by saying he hopes to get a deal done. This should highlight the fragile nature of our relationship with China and the fact that the trade deal is still just a “concept” of an agreement. Until there is an official signing, uncertainty will remain.
• Economy Shows Weakness – While headline economic numbers look good, with the latest GDP number showing a 3.8% increase in the second quarter of 2025, all parts of the economy might not be as strong.^[vii] In late September, the Labor Department revised its non-farm payrolls down by 911,000 for the year ending in March 2025, the largest revision since tracking began in 1979.^[viii] Speaking with recent college graduates reveals just how difficult the current job market is. LSAT registrations are reportedly up 50% from this time last year, which supports the idea that college graduates are struggling to find employment and looking for alternative paths. Slowing employment can be a leading indicator of a slowing economy.
• Credit Issues – In late September, First Brands, a holding company of 25 automotive-related companies, filed for bankruptcy. While not good, the bankruptcy on its own is not a market-shifting event. However, it could foreshadow a fragile environment. Much of what eventually crushed First Brands was private debt that, through financial engineering, was kept off the balance sheet. There is some fear within Wall Street that the private debt market has gotten too big, too fast, resulting in relaxed lending standards that have created loans some borrowers will not be able to repay. While the fears might be overblown right now, it is something worth monitoring.

I think the incredible returns of the last three years, coupled with issues above (and others) are why a lot of people are not sure what to do right now. While we don’t have a crystal ball (I wish we did), we do have some ideas on how to invest in this environment. Our long-term clients should not be surprised by anything that follows:

• If you’ll be needing cash in the coming years, now is not a bad time to raise it. Sure, you might pay some capital gains tax, but that is because you made a good investment, and it went up in value. Taxes should be a factor in any investment decision, but they should not be the only one.
• If you have excess cash that is not needed to meet your spending obligations for the next five or so years, it is still appropriate to invest in a well-diversified portfolio. With markets where they are now, consider dollar-cost averaging into investments and not all at one time.
• Don’t get caught up in the shiniest object. Currently, that is any company that is in the AI space. Not to say don’t invest in companies or sectors involved in AI but continue to focus on building a diversified portfolio depending on risk tolerance, which could refer to fixed income investments, international investments, and/or value stocks, to name a few.

This is the only commentary that comes during the fall, which, in my opinion, is the best time of year. The weather is perfect (at least here in Atlanta), there is football being played, and it’s just before all the craziness of the holiday season. I bring this up to encourage you to get out and enjoy this wonderful time of year with family and friends. We will be here keeping our eyes on everything.

I just returned from fall break with my family in Asheville and Athens to see some football, and we had a great time. If I can, I’d like to give one final prediction on my beloved Georgia Bulldogs, who have started the year 6-1 and are ranked #5. Often, when examining the markets, we look to the past to help us better understand the future. Past performance does not guarantee future results, and the same can be said for football seasons. With numerous close games already, I am expecting the last part of the college football season to be a wild ride, but I think we will get through it just fine. Just maybe there will be some parallels to the markets.

The views and opinions expressed are of Persium Advisors, LLC. This commentary is provided for educational purposes only and should not be construed as investment advice. Persium Advisors is an investment advisor firm located in Atlanta, GA.

[i] https://www.morningstar.com/etfs/arcx/spy/performance

[ii] https://www.morningstar.com/etfs/arcx/spy/performance

[iii] https://www.nasdaq.com/articles/gold-price-update-q3-2025-review

[iv] https://ca.finance.yahoo.com/quote/BTC-USD/history/?period1=1735689600&period2=1761060845

[v] https://www.morningstar.com/etfs/arcx/agg/performance

[vi] https://www.investing.com/indices/us-spx-500-historical-data

[vii] https://www.bea.gov/data/gdp/gross-domestic-product

[viii] https://www.cnbc.com/2025/09/09/jobs-report-revisions-september-2025-.html