Market Setbacks

If you hold any funds in pensions or investments, I would imagine you’ll have noticed things going up and down in value over recent months. Several factors are impacting sentiment and therefore performance. Many of these factors are well publicised (such as Brexit, trade wars, and so on), and a lot of the bad news has been baked into prices.

So, what should you do at times like this? Well, if you are feeling fine about the current market volatility and expect the odd market setback, that’s fantastic. Stay that way, as the ups and downs are a natural part of investing. However, I’m equally aware that you (we) are human, and prone to dwelling on market setbacks even if we know we shouldn’t.

If nothing else, it is a timely reminder to always remember your “true north”. As humans, we like to feel good when investing, and it is a financial adviser’s job to lead you down this path by seeking to make your investment journey as fruitful as possible.

We can’t stop the market rollercoaster, but we can make sure you are on the right track.

Therefore, my message to you is threefold. First, please remember that we expect ups and downs over the journey and the odd setback is normal. Second, periods such as these perversely create opportunities to add more value. And last, but not least, is to focus on our true north. By that I mean always reflecting on your long-term goals, as this reinforces the reason we invest.

Ultimately, it’s easy to overplay the significance of recent volatility and think “this time is different” (it rarely is). With volatility comes opportunity, especially for the patient and sensible ones. What is particularly interesting is how quickly investors, and especially the media, can look with perfect hindsight and make setbacks into a problem.

If you think about this logically, we have a better ability to “buy low” in times of market distress, where panicked investors typically show a tendency to sell. I’ll leave with you this timely quote from Warren Buffett, “The stock market is a device for transferring money from the impatient to the patient.” We continue to focus on providing quality financial advice, so please get in touch if
you are feeling uneasy or wish to review your plans.

Contact Nathan or Ainslie on 01228 530913 or Phil on 01768 864466.

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