Why Volatility Is Your Biggest Trading Advantage in 2025

Editor’s Note: Markets don’t just react to headlines anymore. Instead, they whip violently with every new political move. Since President Trump returned to the White House, the stock market has gone from quiet to chaotic and back again, with historic crashes and massive rallies happening in the span of days.

For many investors, this kind of volatility is a source of stress. However, it can be an asset, not a risk, when coupled with the right trading system.

As we enter the second half of 2025, InvestorPlace Senior Analyst Luke Lango believes the next wave of big returns will come from embracing market uncertainty and applying his proven, quantitative trading method, rather than following the crowd.

Today, Luke is joining us to explain why volatility creates both risk and opportunity… how his fast-acting, quantitative trading system was built to thrive in market turbulence… and how to position yourself for success in the second half of 2025.

Take it away…

Is volatility Wall Street’s ‘new normal’?

The stock market has been anything but steady in the first half of 2025. Since Donald Trump took office as the 47th President of the United States in late January, investors have endured a dizzying ride.

At first, markets stayed quiet (flat for about a month). But that calm quickly turned into chaos.

From mid-February to mid-March, the S&P 500 plunged 10% in just 20 trading days. Analysts blamed growing fears that Trump would ignite a global trade war. Those fears were realized on April 2, when Trump launched his “Liberation Day” tariffs. The move triggered a historic two-day, 10% drop in the index — marking the fifth-worst two-day crash on record.

Then came the snapback.

One week later, Trump announced a 90-day pause on those same tariffs. The market roared back. The S&P 500 surged 9.5% in a single session — the start of a massive 20% rebound over the next month.

In just 90 days, stocks had crashed 20%, then fully rebounded. That kind of volatility hasn’t been seen since the pandemic era, and it’s reshaping how investors think about political risk and policy shockwaves in 2025.

This has been arguably the most volatile and violent stock market ever. And given that Trump has been the trigger – and that he will be in the White House for the next four years – investors are naturally asking themselves:

Is this intense volatility Wall Street’s ‘new normal’?

It may be…

A Bumpy Ride Higher: Why We Expect Stock Market Uncertainty to Continue

Don’t get me wrong. I think stocks are going higher over the next few years.

We’re somewhere in the middle of the AI Boom. Tech booms like these tend to last five to six years or longer. Just look at the Dot-Com Boom, which started in 1995 and lasted through 1999 – five years of strong gains. The Nasdaq Composite rose about 582% during that time, while the S&P nearly tripled.

This AI Boom started in 2023. I think we have another two to three years of exceptional growth left in AI stocks. And that growth should drive the whole market higher.

However… I don’t think it’ll be a smooth ride higher…

Largely because of U.S. President Donald Trump, who promises to change a lot of things.

He wants to renegotiate trade deals and restructure global trade, rethink America’s global military presence, and cut federal spending. He wants to reduce taxes, expand America’s borders, and reshore manufacturing activity, among other things.

Clearly, he aims to change a lot.

Now, I won’t offer an argument as to whether these proposed changes are good, bad, or neutral.

But I will state the obvious: It’s a lot of change. And change is uncomfortable – especially for investors…

Because change equals uncertainty. That doesn’t mean this policy shakeup won’t push stocks higher in the long term. It may.

It simply means that, along the way, stocks will continue to be volatile – just like they’ve been over the past few months.

Stock Market Volatility by the Numbers: Record-Breaking Swings Under Trump

Since Trump was inaugurated earlier this year, we’ve seen:

One of the fastest 10% drops
Following the announcement of the “Liberation Day” tariffs on April 2, the S&P sharply declined, dropping over 12.1% in the subsequent four sessions.
One of the worst two-day crashes
On April 3-4, the market suffered a 10.5% setback, marking the fourth-worst two-day stretch since 1950.
One of the best single-day rallies
Following President Trump’s announcement of a 90-day pause on recently implemented tariffs, the S&P surged 9.5% on April 9, marking its strongest one-day performance since October 2008.
One of the best win streaks
On May 2, the S&P locked in its ninth straight day of gains – the longest winning streak in more than 20 years – rising roughly 10% over that stretch.
One of the highest readings for the volatility index
The CBOE Volatility Index (VIX), often referred to as the market’s “fear gauge,” nearly doubled over six months, reaching a reading of 27.86.

This has been a three-month stretch for the record books.

If you think things will “mellow out” over the next 45 months, we think you’re sadly mistaken.

Trump’s second term is already shaking up the markets — and the chaos is far from over. Between sweeping policy moves and sharp reversals, volatility is no longer a phase… it’s the new normal.

But that’s not a threat — it’s an edge…

How to Turn Market Chaos Into Your Greatest Advantage

Volatility doesn’t just create risk … it creates opportunity. Massive, repeatable, short-term upside potential.

In markets like this, buy-and-hold thinking won’t cut it. You need a strategy that can adapt fast — and profit even faster.

That’s where Breakout Trader comes in.

Breakout Trader is a fast-acting, quantitative trading system built to thrive in market turbulence. At its core is Stage Analysis, a powerful technical framework that identifies stocks transitioning into high-momentum breakout phases.

It scans the entire market to pinpoint rare setups where: