How have investors reacted to Trump tariffs and market turmoil?

• interactive investor recorded its highest-ever trading volumes yesterday (7 April 2025), with investors buying more than selling
• The new record came just three days after the previous peak last Friday, with trading volumes 36% higher than the former record
• interactive investor saw more buys than sells, with 61% of trades being purchases and 39% sales
• Alex Watts, interactive investor’s senior investment analyst, offers fund picks for navigating volatile markets.

interactive investor, the UK’s second-largest DIY investment platform, reported its busiest-ever day for trading volumes yesterday (7 April 2025), as market volatility, fuelled by President Donald Trump’s tariff announcements, spurred a flurry of investor activity – with more purchases than sells.

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The new record came just three days after the previous peak last Friday, with trading volumes 36% higher than the former record and 52% higher than the third-busiest day on record on 9 November 2020, when Pfizer announced its Covid-19 vaccine breakthrough.

More buys than sells

Since Trump’s announcement of so-called reciprocal tariffs sparked market turmoil on Wednesday evening, interactive investor has seen more buys than sells, with 61% of trades being purchases and 39% sales, suggesting many investors are viewing the dip as a buying opportunity rather than heading for the exit.

The buy/sell ratio is broadly in line with levels seen during the first quarter of the year, pointing to a consistent appetite among investors to stay invested despite heightened volatility.

Most-traded investments on interactive investor since full trading day after Trump’s tariff announcements on Wednesday evening (Thursday 3 April – market close 7 April)

Source: interactive investor. Overall, 61% buys, 39% sells over the period.

Most-traded US equities on interactive investor since full trading day after Trump’s tariff announcements on Wednesday evening (Thursday 3 April – market close 7 April)

Source: interactive investor. Overall, 62% buys, 38% sells over the period.

Most-traded investments on interactive investor since 1 March – market close 7 April 2025

Source: interactive investor. Overall, 60% buys, 40% sells over the period.

Richard Hunter, Head of Markets, interactive investor, says: “There is evidence that our customers are attempting to take advantage of market volatility by buying quality companies during the dip. At the eye of the storm has been the “Magnificent Seven”, previously drivers of exceptional market performance over the last couple of years. So far this year, previous AI market darling Nvidia, for example, has lost 29% and is 35% lower than its record high. In addition, Tesla has declined by 38% this year and Amazon by 20%.

“Military tensions have resulted in a large actual or proposed bout of increased defence spending, and interactive investor investors appear to have been riding this wave. BAE Systems and Rolls-Royce have now risen by 37% and 13.5% respectively in the year to date. Indeed, Rolls-Royce has seen an additional boost having implemented a turnaround plan which firmly placed it in investors’ good books. These shares have risen by 56% over the last year, with little sign of the positive momentum fading.

“Elsewhere, the usual attraction of high-yielding blue-chip stocks was also in evidence, leaving Legal & General comfortably in the top ten given its dividend yield of 9.7%. 

Broaching market volatility in new tax year

Myron Jobson, Senior Personal Finance Analyst, interactive investor, says: “Despite the market jitters sparked by Trump’s tariff threats, our customers have remained net buyers, with purchase levels broadly in line with those seen in the first quarter of the year. It suggests that many investors are looking past the short-term noise, viewing recent market weakness as a buying opportunity rather than a reason to retreat. Notably, customers have been snapping up both UK and US equities, illustrating a willingness to capitalise on perceived value at home and across the Atlantic.

“Market volatility in the run-up to the tax year end – and as a new one begins – can prompt a mixed response from investors. For some, heightened turbulence might encourage a ‘wait and see’ approach, delaying ISA and pension contributions in the hope of more settled conditions. Others may view it as an opportunity to invest while prices are lower, making full use of refreshed allowances early on.

“The key is to stay focused on long-term goals rather than short-term market noise. Timing the market is notoriously difficult, and the risk of missing out on future gains can be greater than any short-term dip. Regular contributions – sometimes referred to as pound-cost averaging – can help smooth out the highs and lows, making volatility less daunting.

Fund picks for volatile markets

Alex Watts, Senior Investment Analyst, interactive investor, says: “Going forward, the market may see some more uncertainty and volatility and it is important to remind investors of a well-known old wisdom, that the best investment outcome is achieved through time in the market, not timing the market. 

“In addition to conventional defensive assets such as bonds, golds and healthcare stocks, investors looking to lessen the impact of volatility can consider minimum volatility strategies. Historically, low volatility stocks have shown higher average returns than high volatility stocks over time.

A good option is iShares Edge S&P 500 Min Vol ETF USD Acc GBP (LSE:MVUS), which tracks the performance of an index composed of selected companies from S&P 500, which collectively exhibit lower volatility than the broad stock market while maintaining characteristics like sector and factor exposure that are similar to the S&P 500. Ongoing charge is 0.20%. Other iShares ETFs which employ similar strategy are iShares Edge MSCI World Minimum Volatility ETF $ Acc GBP (LSE:MINV), iShares Edge MSCI EuropeMinimum VolatilityETF €Acc (LSE:MVEU)andiShares Edge MSCI EM Minimum VolatilityETF $ Acc GBP (LSE:EMV). 

“Given the heavy weighting towards the so called Magnificent Seven companies, returns for the S&P 500 have been very much dictated by the share prices of these technology-focussed companies of recent, both to the upside and to the downside. If you're invested in funds that track the S&P 500 Index, your portfolio may be too concentrated and greatly impacted by fluctuations in these large-cap tech stocks. By enhancing diversification and reducing concentration at stock and sector level, the Invesco S&P 500 Equal Weight ETF Acc GBP (LSE:SPEX) offers unique core exposure to US blue-chip stocks in the S&P 500 with lesser concentration risk. 

The ETF provides equally weighted exposure to US blue-chip stocks that make up the S&P 500 index. Every stock in the index has the same weight at just 0.2%, regardless of how large or small the company is. The fund is designed to reflect the US large-cap equity market while taking a size neutral approach and covers approximately 80% of the available market. It is competitively priced with an ongoing charge of only 0.20%. 

“More cautious investors could consider multi-asset funds such as Capital Gearing Ord (LSE:CGT). The trust has two objectives: to preserve capital over any 12-month period, and to deliver returns well in excess of inflation over the longer-term. It aims to achieve its investment objectives through a long-only, multi-asset portfolio of bonds, equities, and property, with small holdings in infrastructure, gold, and cash. 

“The trust invests in index-linked government bonds – which account for just over one third of the portfolio - as well as gold and safe-haven currencies. It has been managed by highly regarded investor Peter Spiller since 1982 and has been a great preserver of wealth in bear markets. This trust as a good fit as a core holding due to its defensive stance and high levels of diversification.”