Policymakers have had an outsized impact on financial markets in 2018, for better and for worse.

On the positive side, U.S. investors have cheered efforts toward deregulation as well as last year’s tax cuts.  Conversely, uncertainties over the Federal Reserve and U.S. trade policy have roiled markets over the past two months.

The Fed has sent conflicting messages on interest rates, suggesting in October that rates were a “a long way” from the desired level, only to say two weeks ago that rates are “just below” where they need to be.  Meanwhile, trade tensions between the U.S. and China have gone on longer and been higher stakes than most investors expected.

Lost in the crush of policy-related headlines is that corporations continue to perform well.  Indeed, there is disconnect between on one hand, strong corporate results, and on the other hand, low or negative returns for stocks (chart).

Over the long run, stock prices tend to follow corporate fundamentals.

By owning stocks in your portfolio, you are betting not that policymakers will make all the right decisions. Rather, you are looking to the great corporations of the world to adapt and grow even in a shifting policy environment — just as they have in decades past.