How to deal with unpredictable geopolitics upon investing? Practical manual.

Why geopolitical external risks are a factor you can't control (but one that shouldn't keep you out of the market)?

Educational material. General information, not individual investment advice.

Geopolitical external factors are things you can't control, yet they directly affect the stock market: they ripple through the global economy, which is exactly why we periodically watch major world indices sell off and panic spread across markets.

Whether you're an investor at any scale or simply someone, trying to protect their savings, geopolitical risk and the way the market prices it will affect you regardless. You can't hide from it, so it's worth understanding how it actually works.

A force majeure which you should ignore?

Many investors view geopolitical risks as force majeure and completely ignore them. Is this approach correct? This certainly makes sense, but the risks cannot be completely ignored, since they can be both a good factor for entering the market and a bad factor for selling at a reduced price at the same time. However, treating geopolitical factors as force majeure, since force majeure itself is a factor beyond control, is something that can maintain your balance and keep you from general panic on the market.

The most pressing example: the Middle East

Consider the sharpest factor on the table today — the situation in the Middle East: the confrontation between Iran, Israel and the US, and the threat of a blockade of the Strait of Hormuz, through which a significant share of the world's oil supply passes.

Here's what a conflict like this affects:

• The price of oil, which countless companies need for production and logistics. Rising oil prices push up costs across almost the entire economy.
• Logistics routes. Disruption to established shipping lanes forces companies to find longer, more expensive alternatives — where they exist at all.
• Inflation and margins. The higher the cost of raw materials and fuel, the lower people's purchasing power and the thinner production margins become — and with them, company profits.

Are these frightening factors a good enough reason to stay out of investing altogether? Not really.

A few things worth keeping in mind:

• Geopolitics hits everything at once: every stock market, every currency, even crypto. There's essentially no perfectly "risk-free" haven that it doesn't touch.
• Doing nothing has a cost too. Even if you postpone investing "until things calm down," inflation can keep eroding your savings, including the inflation driven by those very same oil and fuel prices.
• A panic-driven drawdown is not the same as weak fundamentals. Stocks often fall not because of any real loss at a specific company, but because of broad market panic and in that case, the dip really can be an attractive entry point.

One important caveat to that last point: it isn't always true. Sometimes a market drop isn't panic but a justified reaction to a genuine deterioration in the economy a recession, falling demand, rising rates. The investor's key job is to tell temporary panic apart from a real fundamental decline, which is exactly why you should look at a company's own numbers, not just the general news backdrop.

What about a safe haven?

The classic defensive asset is gold. But it comes with caveats too, especially right now:

• Gold has already been through an enormous rally: from around $2,624 at the start of 2025, it climbed to an all-time high of roughly $5,400–5,600 per ounce in late January 2026. Today it trades below that peak, around $4,500 an ounce but that's still about a third higher than a year ago. In other words, buying gold now means buying an asset at historically very elevated levels.
• It's important to understand that this rally wasn't driven by the Middle East conflict alone. The main drivers were a weaker dollar, record central-bank gold buying, and inflows through ETFs; geopolitics merely added to the demand. Which means the unwinding of any of those factors: a de-escalation, say, or a stronger dollar which could turn the price back down. At the peak of frenzied demand, gold itself becomes more speculative and volatile than the "safe haven" label suggests.

The verdict

To preserve and grow your capital, you don't have to hide from the market every time geopolitics becomes a daily threat. In fact, a panic-driven price decline can be viewed as a chance to enter at a better price but only once you've satisfied yourself that the fall reflects market sentiment rather than a real deterioration in the business.

Yes, you may have to sit through a drawdown. But drawdowns are an inherent part of investing in the first place, even without any external geopolitical risk. The question isn't how to avoid them entirely (you can't) - it's whether you're prepared for them and whether your portfolio is diversified enough.

If you've decided to invest, StocktalkSA can help you choose the right asset, thanks to up-to-date news, analysis and the indicators you need to make a considered decision. But the final decision, and its risks, always rest with you: only invest what you can afford to set aside, and where possible, consult a licensed professional.