The global trade war launched by the U.S. has evoked the “elbows up” rally cry in Canada.

It’s most often associated with NHL legend Gordie Howe but any small kid playing hockey knows what it means when they square off against a big kid in the corner. Elbows are the best line of defence and can deliver a few offensive few jabs.

It also applies to small Canadian retirement investors backed into a corner right now with a world of big players. The current market volatility is mostly a reaction to theatrics for now, but a good long-term defensive strategy and a few opportunistic jabs can keep your portfolio on track if it gets worse.

Another crisis to put in perspective

If you’re thinking of cashing out, this trade war is not the end of the world.

Whenever an “end of the world” market event occurs, U.S. based Ritholtz Wealth Management often circulates a long-term chart of the benchmark S&P 500 Index marking historic “reasons to sell” events.

The tragic events highlight the 2010 “Flash Crash,” the 2011 earthquake/tsunami in Japan, the 2013 “Taper Tantrum,” the Ebola virus of 2014, The Brexit vote in 2016, and the 2018 global trade war.

It also includes the global pandemic in 2020, the storming of the U.S. Capital in 2021, and the second wave of the pandemic shortly after.

In all those events, the S&P 500 regained its losses and advanced to record territory 100 per cent of the time.

Earnings from the S&P 500 have not been this strong since the COVID-19 recovery and most major corporations are not revising their current outlooks as a result of the trade war.