It always makes me pause and honestly laugh a little when I hear:
“These are unusually uncertain times.”

Compared to when?

Uncertainty is not new. It is always present. It is the baseline condition of investing and of life.

What changes is not uncertainty itself, but our perception of it.

When markets are calm, we feel confident. When markets move, we feel uncertain. That feeling is not a reliable signal of reality. It is a reflection of human psychology. We are wired to overweight recent events, to react to visible movement, and to mistake volatility for risk.

At Members’ Wealth, we frame our work through R.I.T.E. which stands for Risk, Investments, Tax, and Estate. Of those four, we start with risk. Not just as a statistic on a page, but as behavior—and how each investor defines what actually matters to them.

We help investors identify risks they may be overlooking—and properly weigh the ones they are focused on.

Risk, as we define it at Members’ Wealth, is the probability of a permanent loss of capital, not the temporary volatility or uncertainty along the way.

This is where we spend most of our time—not predicting markets, but helping clients navigate their own behavior within them.

That risk of permanent loss of capital can increase in periods of high perceived uncertainty because of how we might act when uncertainty feels elevated.

Uncertainty is always present. Behavior is variable. That is where the real work is done.

Visibility Into Risk

In finance, there is a distinction that matters more than most people realize. Volatility is observable. Prices move up and down and we can see it in real time.

Uncertainty isn’t directly measurable. We infer it through market signals like volatility and pricing; it represents what we cannot know about the future.

We tend to confuse the two.

When markets are stable, we assume the future is predictable. When markets move sharply, we assume the future is unknowable. In reality, the future is always unknowable. The only thing that changes is our perception of how visible that future becomes.

Mr. Market

As it relates to investing, Benjamin Graham, one of the founders of fundamental investing, speaks to the manic behavior of markets in uncertainty decades ago, in 1949 when he first published the book, The Intelligent Investor, through the concept of Mr. Market. Famed investor, Warren Buffet, a student of Grahams, recounts the story in his 1987 annual letterⁱ.

Buffett described Mr. Market as a partner who shows up every day offering to buy or sell you stocks at a price—often driven by emotion, not fundamentals.

But his key insight: you are never required to act. You are only invited.

As I see it, Graham’s insight (and Buffett’s retelling) was simple and powerful. The market is not there to guide you. It is there to serve you.

The Market

At times the market reflects unsustainable optimism which pushes prices too high. At other times it reflects unjustified pessimism which pushes prices too low. In both cases, what has changed is not uncertainty, but perception.

If uncertainty is always present, then it cannot be the enemy. The real risk is how we respond to it.

When prices fall and headlines turn negative, we feel pressure to act defensively. When prices rise and optimism builds, we feel pressure to chase returns. These responses are not driven by fundamentals. They are driven by behavior.

The same patterns show up over and over again. We chase what’s working. We panic when it’s not. We look for confirmation from others. And we feel the need to act—even when doing nothing is the better decision.

None of these tendencies improve outcomes. Most of them quietly erode them. Often more than fees, taxes, or even bad investments.

Know thyself

This brings us back to Risk. Not risk as an external force, but risk as an internal one. The goal is not to eliminate uncertainty. That is impossible. The goal is to manage behavior within it.

That starts with awareness. When you feel uncertainty rising, pause and name it. What you are experiencing is a shift in perception, not a change in reality.

From there, discipline becomes possible, but only if it has been defined ahead of time. The most effective investors do not make decisions in the moment. They make decisions in advance and follow them when emotions rise.

In periods of pessimism, when prices are lower and sentiment is negative, that is when capital should be deployed. In periods of optimism, when prices are elevated and expectations are high, that is when risk should be reduced or rebalanced.

This is not complex. It is simply difficult. The difficulty is not intellectual. It is behavioral.

Markets will continue to fluctuate. Narratives will continue to change. There will always be a reason to feel uncertain. None of that alters the underlying reality.

Mr. Market’s daily mood swings are not problems to avoid. They are opportunities to observe.

Those moments rarely feel comfortable.

That’s exactly why they matter.

Uncertainty doesn’t create risk. It reveals it.

The question is not whether uncertainty exists. It’s whether you let it control you or put it to work.

 ⁱWarren Buffett on “Mr. Market”

Ben Graham, my friend and teacher, long ago described the mental attitude toward market fluctuations that I believe to be most conducive to investment success. He said that you should imagine market quotations as coming from a remarkably accommodating fellow named Mr. Market who is your partner in a private business. Without fail, Mr. Market appears daily and names a price at which he will either buy your interest or sell you his.

Even though the business that the two of you own may have economic characteristics that are stable, Mr. Market's quotations will be anything but. For, sad to say, the poor fellow has incurable emotional problems. At times he feels euphoric and can see only the favorable factors affecting the business. When in that mood, he names a very high buy-sell price because he fears that you will snap up his interest and rob him of imminent gains. At other times he is depressed and can see nothing but trouble ahead for both the business and the world. On these occasions he will name a very low price, since he is terrified that you will unload your interest on him.

Mr. Market has another endearing characteristic: He doesn't mind being ignored. If his quotation is uninteresting to you today, he will be back with a new one tomorrow. Transactions are strictly at your option. Under these conditions, the more manic-depressive his behavior, the better for you.

But, like Cinderella at the ball, you must heed one warning or everything will turn into pumpkins and mice: Mr. Market is there to serve you, not to guide you. It is his pocketbook, not his wisdom, that you will find useful. If he shows up some day in a particularly foolish mood, you are free to ignore him or to take advantage of him, but it will be disastrous if you fall under his influence. Indeed, if you aren't certain that you understand and can value your business far better than Mr. Market, you don't belong in the game. As they say in poker, "If you've been in the game 30 minutes and you don't know who the patsy is, you're the patsy.

...[A]n investor will succeed by coupling good business judgment with an ability to insulate his thoughts and behavior from the super-contagious emotions that swirl about the marketplace. In my own efforts to stay insulated, I have found it highly useful to keep Ben's Mr. Market concept firmly in mind.

Letter to Shareholders, 1987 Berkshire Hathaway Annual Report

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About the Author

Dane Czaplicki, CFA®

Dane Czaplicki is CEO of Members’ Wealth, a boutique wealth management firm that offers a comprehensive approach to serving individuals, families, business owners, and institutions. The firm’s goal is to preserve and grow its clients’ wealth to endure over time, while thoughtfully evolving its strategy to suit an ever-changing world. With over 20 years of wealth management experience, Dane and the Members' Wealth team thrive on bringing clarity and confidence to clients' unique situations. He believes everyone needs sound financial advice from someone whose interests are aligned with theirs, and is determined to put service before all else.

Dane received his MBA from The Wharton School of Business at the University of Pennsylvania and his bachelor’s degree from Bloomsburg University. Outside work, he enjoys spending time with his wife and kids, hiking and camping, reading, running, and playing with his dog. To learn more about Dane, connect with him on LinkedIn.

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