Recently, economic headlines have been dominated by tariffs that the United States has implemented on trading partners worldwide and the impact that these are having on the global economy. The fact is that countries rely on one another to build and deliver products to market, so a disruption here will affect companies’ ability to do business due to higher prices and reduced access to markets. This creates significant challenges for sales, company projections, and even employment. Worse, if countries’ tariffs are reciprocated and escalated, the availability and/or price of affected goods can make them prohibitive to purchase.
So, how can tariffs impact your investment, and what can you do to create stability in this kind of environment?
Basically, tariffs are taxes imposed on imported goods, designed to protect domestic industries by making imported products more expensive. While they may offer short-term relief to local manufacturers, tariffs can also disrupt supply chains, raise production costs, and escalate trade tensions.
In practice, tariffs often function as a double-edged sword. For example, if the United States imposes a 25% tariff on imported steel, domestic manufacturers who rely on steel — such as automakers or construction firms — face significantly higher supply costs. These companies either absorb those costs, which cuts into profits, or pass them on to consumers, which reduces demand. Either way, investors in the affected industries are negatively impacted.
A portfolio - a personal collection of investments - is made up of stocks, bonds, cash equivalents, and alternative assets. Because they can react differently to the introduction of tariffs, you’ll want to understand these differences to manage your risk.
Publicly traded companies are often the most visibly affected by tariffs, especially those with global supply chains. When tariffs are introduced or increased, the stock markets tend to react immediately — and often negatively. Even companies not directly affected by tariffs can experience collateral damage as market uncertainty spreads.
Fixed-income securities, such as publicly traded bonds, typically behave more conservatively than stocks. In times of increased market volatility, investors often move capital into government bonds, viewing them as a safer alternative. As a result, U.S. Treasury prices often rise, and yields fall, during trade-related market selloffs.
However, tariffs can indirectly put upward pressure on inflation — especially when imported goods become more expensive. This can reduce the real return on long-term bonds. This may trigger central banks to respond to inflationary pressure by raising interest rates causing bond prices to decline.
In uncertain economic environments, alternative assets — including real estate, commodities, and private equity— can stabilize a diversified portfolio. Because these investments are often not affected by public markets, they may not respond as much to tariff-related volatility.
Worthy Property Bonds are a type of alternative fixed-income investment that is not subject to market volatility as they are what is deemed a “private market security”. Worthy bond sales are used to fund residential real estate development projects and investors earn a fixed interest rate regardless of stock market movements.
Worthy Property Bonds can serve as a valuable way to diversify your portfolio in a broader investment strategy:
While not without risk (no investment is truly risk-free), Worthy Property Bonds offer principal stability and an attractive yield, making them a compelling option for balancing a portfolio impacted by tariffs.
Tariffs are not just economic occurrences — they’re levers of policy that can affect corporate profits, investor behavior, and the performance of your personal portfolio. While they are intended to protect national interests, they often create short-term volatility and long-term uncertainty in the markets.