Thinkpiece

29 Apr Thinkpiece

In this update: 

• • Patience

Patience

One of the most challenging elements of investing is having to remain patient in difficult circumstances.

If you can keep your head when all about you   

   Are losing theirs and blaming it on you……………

Rudyard Kipling

We’re in a bear market at the present time and it can feel like we’re never going to emerge. History however tells a different story.

Markets can react very quickly. The stock market is a story. When the story changes, the price changes.

Take for example the FTSE All Share (total return) over the past 10 years. It has returned 5.54% per annum.

However, if you miss the best 5 days, the returns falls to 2.91% per annum, that’s a 47% reduction had you been invested for those extra 5 days!

Had you missed the best 10 days, the return falls further to 1.24% per annum, that’s a 77% reduction had you been invested for those extra 10 days!

10 days out of 2548 trading days. That’s only 0.39% of the total days, yet it represents 77% of the return over that short time.

Source Morningstar

So you have to be invested in order to benefit. No one can tell you when those good days will come.

….but you’ve weathered the storm this far.

So one has to be very patient when investing. 

In investing, what is comfortable is rarely profitable.

Robert Arnott

Summary

• Stick to your plan.
• Don’t be swayed by media or untested advisers.
• Volatility is not loss.

A permanent loss in a well-diversified equity portfolio is a human achievement of which the market itself remains incapable.

Nick Murray    

If you’ve not yet put in place a sound financial plan and you’d like to know more, please feel free to contact us on
01626 305318 or via email here.

The views expressed are not to be taken as financial advice. Professional advice should be sought before proceeding.