Is now a good time to buy stocks, or should you wait?
There’s lots of uncertainty nowadays, but that’s never not true — and investors with a long enough time horizon generally come out ahead.
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Looking at financial news headlines right now is enough to make anyone feel unnerved. Whether the markets are up or down on a given day, there’s a constant stream of news stories to make you feel worried — or worried about missing out.
Here’s the thing: it’s almost never a bad time to buy stocks, so long as you have the discipline and patience to see your investment through.
Long-term investments tend to pay off, but sticking with them is easier said than done sometimes. It’s simple when times are good, but can require nerves of steel when times are bad. If you’re thinking about putting some money into stocks right now, you probably have a lot of questions, and we’ve done our best to answer them below.
Is the stock market at a high or a low right now?
The stock market’s highs and lows can only be identified in hindsight, but we can look to history for a sense of where we are in the cycle right now.
The most recent bear market — defined as a period where major stock indexes fall at least 20% from their recent highs — was from late 2021 to late 2022, when the S&P 500 declined about 25% amid fears about high inflation and rising interest rates.
Since then, we have been in a bull market — a period of rising stock prices — although stock prices have been choppy at times.
The S&P 500 got close to re-entering a bear market in early 2025, when new U.S. tariffs (import taxes) spooked investors, but it rebounded shy of the 20% decline threshold. The index has also started 2026 on a sour note, and its year-to-date performance is slightly negative at the time of writing.
The current bull market started about three and a half years ago, in October 2022, and the S&P 500 is up about 90% since then. Since 1942, the average bull market has lasted 4.4 years and had a total return of 151.6% .
Granted, that’s just the average — some bull markets are much longer, and others are much shorter — but it does suggest that stock prices could go higher for a while before the next long-term downturn.
How the S&P 500 is doing this year
Here's how the S&P 500 is performing this year against the closing value of previous years. Also note the long-term averages, which help to bolster the argument that sufficiently long-term investments tend to pay off.
Stock market data may be delayed up to 20 minutes, and is intended solely for informational purposes, not for trading purposes.
What are investors nervous about right now?
There’s always some reason to be nervous about the stock market, but 2026 is a period of heightened investor anxiety for several reasons. Here are a couple of major themes:
Tariffs and geopolitical uncertainty
Since Donald Trump returned to office in early 2025, the U.S. has threatened or imposed tariffs on many countries, including its major trading partners. It has also taken military action against Venezuela and Iran, and threatened to do so against Denmark over control of Greenland.
The new administration’s apparent willingness to start trade conflicts (and military conflicts) has dimmed the U.S.’s reputation in the eyes of international investors, and raised fears that the world’s largest economy is entering an isolationist phase that could impede the free flow of goods, services, people and money around the world.
These fears have led to a sharp decline in the value of the U.S. dollar over the last year, as well as a movement among investors toward safe-haven assets such as gold.
Overvalued tech stocks and a potential AI bubble
In the early 2020s, very large tech companies such as Alphabet (GOOG), Microsoft (MSFT) and Nvidia (NVDA) dominated the major stock indexes and accounted for much of their increases. Some relative newcomers to the tech industry, such as Tesla (TSLA) and Palantir (PLTR), also ballooned in price in the first half of the decade.
A big factor in the tech-driven rally has been hype about the transformative potential of artificial intelligence (AI), rather than concrete revenue and earnings numbers. This hype has propelled some tech stocks to disproportionately high prices compared to their earnings and revenue, leading some experts to question whether their valuations really make sense, or whether they could be in a bubble.
In December 2025, NerdWallet’s investing newsletter, The Nerdy Investor, asked more than a dozen economists about the AI bubble theory. You can read that issue here to see what they said.
Timing the market vs. time in the market
When you start investing isn’t as important as how long you stay invested, said Marguerita Cheng, a certified financial planner and CEO of Blue Ocean Global Wealth in Gaithersburg, Maryland. And that’s a maxim to remember right now, too.
“The best way to build wealth is to stay invested, but I know that can be challenging,” Cheng said in an email interview.
It’s easier if you invest only for long-term goals. The reason you don't invest money you may need in the next five years is because it’s entirely possible the stock or mutual fund you purchase will drop in value in the short term. If you need those funds for a large purchase or emergency, you may have to sell your investment before it has a chance to bounce back, resulting in a loss.
But if you’re investing for the long term, those short-term drops aren’t of much concern to you. It’s the compounding gains over time that will help you hit your retirement or long-term financial goals. (See how compounding gains work with this investment calculator.)
It is possible to invest for shorter-term goals using more conservative investments, such as bonds or fixed-income investments. These tend to be more resilient against stock market downturns but often rise much less than stocks during bull markets. You can tailor your asset allocation — the breakdown of your portfolio between volatile investments such as stocks, and conservative investments such as bonds — to suit different goals with different time horizons.
» See our picks for the best brokerage accounts.
How long would your account take to recover from a downturn?
According to 2024 data from Invesco and Bloomberg, it has taken an average of three months for the Dow Jones Industrial Average to recover from a 5-10% drop, and an average of eight months to recover from a 10-20% drop .
You can use our market crash recovery calculator below to estimate how long it would take you to get back to your pre-drop balance after a downturn.
As you can see, even a severe downturn is unlikely to keep you below break-even level for more than five years — so long as you stay the course and keep making modest contributions to your investments consistently.
This is still true if you assume relatively weak returns after the crash, which would be unusual; typically the market rises quite fast in the first couple of years after a downturn.
Where and how should you invest right now?
Here at NerdWallet, we have a lot of opinions about which stock trading platforms are best for different kinds of investors. Here’s a quick summary of some of the best brokers we review, broken down by different investing styles and use cases:
Best for passive, long-term investors: Fidelity
Fidelity frequently wins several of NerdWallet’s Best-Of Awards for brokers, such as Best Online Broker for Beginners, due to its wide investment selection, easy-to-use app, and strong customer service support.
Buy-and-hold investors who want index funds — broadly-diversified investment funds that contain hundreds of stocks and just give you the market’s overall rate of return — will likely be pleased with Fidelity’s offerings, which include fractional share purchases (the ability to buy less than one share of a fund, using only a small amount of money) and a proprietary family of completely free index funds that have no sales fees or expense ratios.
Less-tech-savvy investors, however, may be bothered by Fidelity’s high fees for placing orders via phone call. You can read more in our full Fidelity review.
Best for active traders and stock pickers: Interactive Brokers
Although financial advisors often say that most people are best off passively investing in index funds, some people prefer to take a more active role in their investments. Stock pickers and advanced traders do have the chance to outperform the major stock market indexes, at least in theory.
If you’re trying to beat the market, you’ll probably want a brokerage account with a wide investment selection, advanced research and trading tools and low fees — and Interactive Brokers checks those boxes. It also offers some of the lowest margin rates (interest rates on loans for investment) of any broker we review.
These are some of the reasons why it has won NerdWallet’s Best Broker for Advanced Traders award and topped our Best Day Trading Platforms roundup for several years running.
However, Interactive Brokers is very much geared toward advanced and professional-level investors — beginners and even intermediate investors may want to avoid IBKR, as its platforms can be hard to navigate. See our full Interactive Brokers review for more information.
Best for pessimists: Public
Another type of investor worth addressing here is the conservative investor who thinks the stock market is due for a downturn any day now. They might want a brokerage account that makes it easy to keep cash on the sidelines — and earn a decent rate of interest via bonds or high-yield cash accounts — while they wait for that downturn to happen.
Public.com stands out for this use case, thanks to its variety of high-yield cash account options, with yields above 3% at the time of writing, and its Treasury bond offerings.
More technically-skilled pessimists who want to use options to bet against the market will also love Public.com’s options rebate program, which pays you a small amount for each option contract traded, depending on your order volume.
That said, Public.com does have some drawbacks — they don’t offer mutual funds, and their market research and customer support capabilities are limited. Check out our full Public.com review for the full scoop.
Which stocks should you buy right now?
Most people are better off making consistent investments in index funds, rather than trying to pick stocks.
That said, many traders believe that different industries perform better at different points in the economic cycle of bull and bear markets. Strategies which attempt to follow these trends are known as sector rotation, and there’s no solid consensus about which sector rotation strategies actually work. But here are some common patterns in sector rotation theory:
| Stage of economic cycle | Sectors that may outperform |
|---|---|
| Recession | Consumer staples, health care, utilities |
| Bull market | Consumer discretionary, industrials, technology, real estate |
| Peak | Communication services |
| Bear market | Consumer staples, utilities |
Before you try a sector rotation strategy, there are a couple of caveats to keep in mind. First, there isn’t universal agreement about which sector rotation strategy is the right one. And second, it’s hard to identify where in the economic cycle we are right now. Typically, it only becomes clear in hindsight.
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The water’s fine, but wade in slowly
One of the best strategies for remaining calm and staying invested during periods of volatility is to treat investment contributions like recurring subscriptions — a technique known as dollar-cost averaging.
Through this approach, you invest a specific dollar amount at regular intervals, say once or twice a month, rather than trying to time the market. In doing so, you’re buying in at various prices that, in theory, average out over time.
Robert M. Wyrick Jr., managing member and chief investment officer of Post Oak Private Wealth Advisors in Houston, notes this is also an excellent strategy for first-time investors looking to enter the market during times of uncertainty.
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“It’s very difficult to time when to get into the market, and so there’s no time like the present,” Wyrick says. “I wouldn’t go all-in at once, but I think waiting around to see what happens to the economy or what happens to the market in the next three, six or nine months in most cases ends up being a fool’s errand.”
» Ready to get started? Browse some of the best online brokers for beginners.
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- 1. First Trust. History of U.S. Bear & Bull Markets. Accessed Feb 5, 2026.
- 2. Invesco. What investors need to know about stock market corrections. Accessed Mar 10, 2025.
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