The first half of 2026 gave long-term investors two good reasons to panic. Neither one turned out to be a good reason to stop investing.
What Happened
March: the oil shock
Military strikes on Iran at the start of March sent oil prices sharply higher and revived fears about inflation. Rising bond yields and softer economic data added to the pressure. The S&P 500 fell about 5% for the month, its biggest monthly drop in a year, and the tech-heavy Nasdaq Composite briefly closed more than 10% below its high, the usual definition of a correction.
Then the market turned. The S&P 500 rose more than 10% in April and kept climbing in May, setting new records.
June: the rate-hike scare
On June 5, a stronger-than-expected jobs report raised the odds that the Federal Reserve would raise interest rates instead of cutting them. The S&P 500 fell about 2.6% that day, its worst day of the year so far, and the Nasdaq dropped more than 4% as AI and chip stocks sold off.
At its June 17 meeting the Fed held rates steady at 3.50%–3.75%, but its projections pointed to a possible hike later in the year, and stocks slid again. Even so, the S&P 500 ended June only about 1% below its May close.
The Numbers: Keep Buying or Pause?
Let’s take an investor who put $500 into the S&P 500 at the start of every month in 2026, using SPY with dividends reinvested, and compare them with a cautious investor who paused for March, April and May while the headlines were scary.
| Through June 30, 2026 | Kept buying | Paused Mar–May |
|---|---|---|
| Total invested | $3,000 | $1,500 |
| Portfolio value | $3,231 | $1,588 |
| Gain | +$231 (+7.7%) | +$88 (+5.9%) |
Source: SPY monthly adjusted closes from Yahoo Finance. Each purchase is made at the start of the month. Calculated with the same method as our DCA Calculator.
The investor who kept buying made the April purchase at the end-of-March price, the lowest month-end of the year, and earned more both in dollars and in percentage terms. The investor who paused missed the bargain and the rebound that followed.
Why Pausing Rarely Helps
Pausing feels prudent, but it requires two correct decisions: when to stop and when to start again. In March 2026, the rebound came within weeks, while the news still looked bad. Investors waiting for “clarity” usually get it only after prices have already recovered.
This is the pattern of nearly every sell-off:
- 2020: the COVID crash bottomed in March, while the news was at its worst.
- 2022: the market bottomed in October, while inflation was still running near 8%.
- 2025: the tariff sell-off bottomed in early April, days after the announcement.
- 2026: the March low came before the oil situation had been resolved.
With monthly investing you don’t need to call the bottom. You just need to still be buying when it happens.
What This Means for You
- Keep your automatic investments running. A dip makes each contribution buy more shares.
- Don’t check your portfolio daily. Short-term swings are noise for a 10- or 20-year plan.
- Make sure your emergency fund is in place, so you’re never forced to sell during a downturn. See Build an Emergency Fund Before You Invest.
- If you have spare cash and a long horizon, a dip is a reasonable time to add to your regular amount, but only money you won’t need for years.
Will There Be More Volatility?
Almost certainly. Inflation, oil prices and the Fed’s next move remain open questions for the rest of 2026. But for a long-term DCA investor, volatility isn’t the enemy. It’s what lets fixed monthly purchases buy more shares at lower prices.
Want to test this yourself? Use the DCA Calculator to pick any period, including past crashes, and see what steady monthly investing produced.
Disclaimer: This article is for educational purposes only. It does not constitute investment advice. Past performance does not guarantee future results.