Stay the Course: The Most Expensive Investment Advice for HNW Investors in 2022 (And It Might Be Back in 2026)

In 2022, most UHNW investors in traditional private banking structures watched their portfolios fall between 15% and 20% while their advisors told them, with calm authority, to stay the course.

The signals had been visible for months.

Inflation in the US hit 7.5% by February 2022. Russia invaded Ukraine in late February, sending energy prices into a structural shock. By March, the Federal Reserve had begun raising rates for the first time since 2018. By the end of the year, it had done so seven times — the most aggressive tightening cycle since the early 1980s.

The result was historically unprecedented: 2022 was the worst year for bonds since 1754. The 30-year US Treasury lost 39.2%. The benchmark US government bond fell over 15%. The 60/40 portfolio — the default allocation for most balanced private banking clients — dropped between 16% and 18%, its worst performance since 1937. For the first time in recorded history, stocks and bonds fell double digits in the same calendar year simultaneously.

If you want to understand how the typical bond/stock portfolio structure works and why it failed in 2022, read this article.

There was no diversification benefit. There was nowhere to hide inside the classic portfolio that your banker kept repeating was the "best" approach for you. And for most people whose private banker had them in it, there was no warning that some changes or exits should be considered.

The Macroeconomic Timeline Was Not a Surprise

The events of 2022 did not arrive without announcement.

By Q4 2021, inflation data had already broken past the "transitory" narrative the Fed had been using to manage expectations. The 10-year Treasury yield had been climbing since August 2021. Energy markets were already tightening before Ukraine. The Kremlin had been staging troops at the border since late November 2021.

None of this was secret. It was visible in public data, in commodity markets, in central bank commentary. The question was not whether inflation was real — it was whether advisors were structurally positioned and incentivized to act on it.

In conversations I've had with HNW investors over the past two years, a pattern emerges that I find hard to set aside. People who lost 15% to 20% in 2022 — in portfolios that were supposed to be balanced and protected — often describe the same experience. They called their private banker. They were told the losses were temporary. They were told to stay the course. Some of them did. Some of them are still, quietly, rebuilding from it.

More than the money lost, what many of these investors describe losing is something harder to recover: the trust that the person managing their wealth had the incentive to protect them when it mattered.

I won't draw the conclusion for you. But I think it's worth pausing on the question of why, given the visibility of the signals in late 2021 and early 2022, so many balanced portfolios arrived at year-end essentially unchanged — the same equity exposure, the same geographic allocation — with no transparency or initiative in addressing the risk, while sustaining the largest bond losses in nearly three centuries.

Was there an incentive for them to help you? Or was the priority the bank's own exposure — and the ease of liquidating or hedging their own assets first?

What "Staying the Course" Actually Means

There is a version of "staying the course" that is wise: not panic-selling on a correction, not chasing performance, not reacting to noise. This is legitimate investment discipline, and over a 30-year horizon it has statistical backing.

But there is another version — one that gets deployed in situations it was never designed for — where "staying the course" becomes a justification for inaction in the face of structural change.

2022 was not a correction. It was the end of a 40-year bond bull market. That is a structural shift. When the macroeconomic regime changes — when inflation moves from a cyclical blip to a multi-year condition, when central banks signal a sustained hiking path, when geopolitical shocks alter energy supply chains for years not months — staying in the same portfolio structure is itself an active decision. It is a choice to absorb the full exposure of a regime change with no adjustment.

For a UHNW family managing $10M or more in liquid assets, a 15% drawdown is not an abstract percentage. It is €1.5M. It is the budget for a relocation, a decade of financial education for a next-generation family member, the equity cushion on a real estate position. Losses at that scale are not just "hold and wait" — they represent a structural failure in diversification.

The discipline worth having is not the discipline to never move. It is the discipline to distinguish between noise and signal — and to build a portfolio that can respond to the latter without panicking at the former.

2026: History Doesn't Repeat Itself, But It Rhymes

This piece is not retrospective for its own sake. I am writing it now because the pattern is repeating.

In March 2026, both the Federal Reserve and the European Central Bank held rates unchanged — the Fed at 3.50–3.75%, the ECB at 2.15%. The Fed's preferred inflation gauge, core PCE, remains above 3%, well above target. The rationale for a pause is sound. But the rumours around central banks and the expectations surrounding monetary policy are starting to sound familiar.

In the Middle East, the ceasefire between the US and Iran is fragile and contested — with very low incentives to fully stop on either side. I would not keep my cool on a Trump weekend. Oil prices are reacting. Energy market volatility is elevated. The VIX spiked above 30 this week, its highest since the tariff-driven volatility of mid-2025. Meanwhile, US tariffs have gone from 2.3% at end-2024 to 15.8% today — a trade policy shift that feeds directly into consumer prices and corporate margins. The S&P 500 has given back its early-year gains and turned negative year-to-date through late March.

Markets are receiving simultaneous signals: sticky inflation, geopolitical energy risk, slowing growth, elevated volatility. The consensus response from institutional advisors is to wait for clarity.

The question is what "waiting for clarity" costs in unrealised losses if the clarity, when it arrives, looks like 2022.

What a Signal-Aware Approach Actually Looks Like

To be clear: this is not an argument directly for market timing — especially for passive investors. This is an argument for something more modest and more defensible: scenario-aware portfolio architecture, and being conscious of hedge opportunities that fit the current geopolitical landscape.

A UHNW portfolio designed for 2026 should be stress-tested against at least two scenarios: one where rates stay flat or decline, and one where inflation re-accelerates and forces another hiking cycle. These scenarios have asymmetric consequences — and a portfolio that handles only one of them is not diversified. It is directionally exposed, and riskier with every missile launch and every day the Strait of Hormuz is at any level of disruption.

Practically, this means three things:

Liquidity as a first principle. The ability to reposition requires liquid assets. A UHNW family that has concentrated illiquid positions in private equity, real estate, or closed-end funds has very limited optionality when the macro environment shifts. Maintaining meaningful liquid exposure is wise on the edge of a black swan that suddenly looks more gray.

Options as asymmetric protection. If you are educated enough, or work with professionals who understand derivatives, options are the mechanism by which you limit the downside of being wrong while maintaining the upside of being right. Protective collars and long puts on index exposure do not require predicting the future — they require acknowledging that more than one future is possible.

Energy as a hedge. Don't take my word for it — look at Warren Buffett. Since 2022, Berkshire Hathaway has built a position in Occidental Petroleum worth approximately $11 billion (26.7% of the company) and holds a major stake in Chevron worth over $27 billion. Buffett rarely comments on macro directly, but his capital allocation does. A meaningful position in energy — whether through equities, ETFs, or commodity exposure — provides a natural hedge against the geopolitical scenario that most threatens balanced portfolios today: an oil shock that simultaneously drives inflation higher and compresses equity valuations.

None of this requires predicting the future. It requires acknowledging that more than one future is possible, and preparing accordingly.

The Question Worth Asking

Before 2022, most UHNW investors with balanced private banking mandates had not been told that their bond allocation could lose 39% in a single year. They had not stress-tested their portfolio against a scenario where both equities and fixed income fell simultaneously. They had not asked what their advisor's process was for repositioning under a sustained inflation regime.

Many of them wish they had.

The same questions apply today. If the geopolitical risk in the Middle East produces an energy shock. If sticky inflation forces a rate hike in late 2026. If the Fed signals something in the next two meetings that markets are not pricing in. What is the repositioning plan? How liquid is the portfolio? What protection is in place?

These are not alarmist questions. They are the questions a serious long-term investor should be able to answer — and should expect their advisor to have already considered.

In 2022, the cost of not asking was measured in double-digit portfolio losses. The cost of asking is a conversation.

There is no single solution for every portfolio. But if there is no hedging strategy and no clear picture of the risk exposure, the conditions for repeating 2022 are in place. If you want an overview of your portfolio's risk, talk to us.

This article reflects the author's analysis based on publicly available macroeconomic data and market commentary. It does not constitute investment advice or a personal recommendation to buy or sell any financial instrument. Serra Wealth is an independent consulting firm and is not a licensed investment manager, broker-dealer, or financial institution. All investment decisions and execution remain the sole responsibility of the client. Past performance is not indicative of future results. All investments carry risk, including the potential loss of principal. Serra does not provide tax or legal advice; clients should consult qualified professionals in the relevant jurisdiction.

Daniel Martinez is the founder of Serra Wealth, an independent wealth and relocation consulting firm serving UHNW families across Latin America and Europe.