Fund winners, losers and key takeaways from Trump’s first 100 days

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Ahead of Donald Trump’s return to the White House there was no shortage of professional investors talking up the continued strength of US stock markets. The expectation was that Trump’s “America First” policy would boost domestic stocks and the US economy.

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Some commentators were more bearish, pointing out that Trump’s tariff policies could stoke inflation and cool economic growth. Others pointed to valuations looking potentially overheated following two strong years of performance for the US market in 2023 and 2024, during which the “Magnificent Seven” technology companies heavily influenced the overall returns for the S&P 500 index.

So, while there were concerns that the party was nearing the end, with valuations rising to high levels and the US market becoming more concentrated, what was not widely predicted was such a weak period for US markets during Trump’s first 100 days.

Figures from FE Analytics show that from 20 January to 29 April 2025, the three worst fund sectors were Investment Association (IA) North American Smaller Companies (where the average fund is down -21.8%), IA Technology & Technology Innovation (-16.1%) and North America (-15.1%). Global funds, which typically have around 60% to 75% invested in the US market, were also among the worst sector performers, with the average fund down -10.7%.

Investing in smaller companies can offer greater rewards compared with larger firms, but also carries greater risk. When there’s a downturn, smaller shares tend to fall further, and so it has proved this time around.

Olivia Micklem, manager of the Artemis US Smaller Companies fund, told interactive investor that uncertainty over the shape and form of Trump’s tariff policies led to the increase in stock market volatility.

Micklem said: “Any situation where you’re not entirely clear on where things are going to go, the market becomes a little bit volatile. We’ve had a lot of headlines and a lot of activity, but we really now need things to get firmed up and to know where we stand. Once the market understands that, it’s easier for it to price in what those risks and opportunities look like, and it’s much easier to move past some of the initial noise.”

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Drilling down into individual funds, the worst overall performer was WisdomTree Blockchain ETF, down -33.6%. Funds heavily weighted to the artificial intelligence (AI) theme, or US smaller companies, dominate among the biggest losers.

At the worst point on 8 April, the S&P 500 index had lost 20% of its value from its earlier all-time high, which was achieved on 19 February. When stock markets fall 20% or more from a recent peak, this is known as a bear market.

Meanwhile, the technology Nasdaq index lost nearly a quarter of its value from its pre-Christmas peak to its low point before Trump’s 90-day tariff pause.

Since that nadir, both the S&P 500 and Nasdaq index have made a partial recovery after Trump paused tariffs for 90 days for countries excluding China.

Spreading risk far and wide 

For investors, one golden rule is diversification, a strategy that protects you against market setbacks and gives a portfolio ample opportunity to grow over the long term. Diversification is achieved by owning a mix of different investment types to spread risk far and wide.

When stock market volatility increases, multi-asset funds, which invest in both shares and bonds, would be expected to limit losses more than equity funds that invest globally or in one particular region. This because when share prices fall sharply over a short period, the defensive qualities of bonds are usually paramount.

During Trump’s first 100 days this played out, with the “safest” of the four multi-asset sectors – the Investment Association (IA) Mixed Investment 0-35% Shares sector – down just -1%. Multi-asset funds with a higher percentage in equities, but still plenty of bonds, also limited losses. The average fund in the IA Mixed Investment 20-60% Shares sector is down -2.3%.

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The small number of wealth preservation investment trusts that prioritise protecting investor capital have also provided defensive ballast. Three trusts that meet this description are Capital Gearing (LSE:CGT), Personal Assets (LSE:PNL) and Ruffer Investment Company (LSE:RICA). Each has a low weighting to equities and plenty of defensive armoury, such as low-risk inflation-linked bonds and a small weighting to gold.

Ruffer Investment Company managed to make money, posting a gain of 4.8%. Personal Assets is also in positive territory, up 1.7%, while Capital Gearing made a small loss of -0.3%.

There are other options for investors looking for defensive exposure in a portfolio, including money market funds or gold, as well as broader commodity exposure.

Gold has been the star of the show during Trump’s first 100 days. The best overall fund performer is WS Ruffer Gold, up 24%. Other gold funds have fared well, with iShares Gold Producers ETF USD Acc GBP (LSE:SPGP), Ninety One Global Gold and BlackRock Gold and General up 22.7%, 22.6% and 21.6% respectively.

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Gold is considered a safe-haven asset and performs well at times of uncertainty. While no one knows what the future holds, Trump’s first 100 days serves as a reminder to investors of the power of diversification.