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Find your investment Zen

General

21/04/2021

This past year we have seen global investment markets bounce around as if trapped inside a pinball machine. With the news cycle reporting stomach-churning volatility, it’s easy to believe risk lurks around every corner. That’s why it’s so important to pick an investment mix you can live with through market ups and downs.

For a super member with money invested in the global market, it’s never been more important to maintain an investment outlook based on patience and logic. It’s easier said than done, but there’s a reason experienced investors choose to live by philosophies based on time in the market, not timing the market.

Downturns turnaround

Volatility happens when the price of things moves around a lot. It’s often caused by major events like recessions, terrorist attacks, natural disasters or a global financial crisis. It is an expected - though unwelcome - element of market forces. But volatility doesn't last forever. History has shown that a market decline is often followed by a period of favourable returns. We look at past downturns and recoveries to better understand potential market performance.

Timing the market

Very few good money decisions are based on panic. Yet, when short term markets dip and tumble, many feel compelled to change their asset allocation to a lower risk portfolio. Attempting to time the market like this may not only lock in the losses, it can also increase the risk of missing the ‘good’ periods that come from a recovering market. When markets get turbulent, staying the course and keeping your investment in a diversified mix of assets will serve as your strongest protection over the long term.

Time in the market

Even the most skilled and experienced investor knows that accurately predicting the market’s short term moves is virtually impossible, particularly in today’s bouncy market. However, increasing your investment time horizon can reduce the probability of experiencing negative returns. This way you can ride out the highs and lows to collect on the long term market gains.

Find your investment Zen

If you’re worried about market conditions and want to check your investment strategy is well placed to withstand market ups and downs, call our Client Services Team on 1300 660 027 or use our online booking system to arrange an appointment with a financial adviser. This service is free of charge.

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