Market Update: Keeping Calm in a Volatile Market
Stock market performance for the opening weeks of 2016 makes pretty grim reading. The FTSE 100 is down over 7% and several other overseas markets down more than 10%.
This is apparently the worst start to a year since 1928, which makes it highly unlikely that many of us have experienced such a dramatic start to the year. Uncharted waters, indeed.
In fact it was a good week for doom-mongers. However market corrections of 10% are not uncommon and investors must remember the reason for investing – to provide real returns over the longer term.
At KDW we adopt a multi asset approach to investing delegating the portfolio mix to key strategic investment houses within a risk rated profile. Many of the fund managers that run risk rated portfolios had already reduced risk last year which means that the stock market down turn will already have been anticipated and your investments will have been cushioned from the dramatic fall.
Alternative investments within the portfolio will have protected the investment from pure stock market risk. This is not to say that investment portfolios are not down, as inevitably any portfolio that has a stock market content will have been impacted by the opening few weeks.
Now however, is not the time to panic and sell, as the fund managers are working long in to the night to position the portfolios to minimise the downside risk and buy back in to the market as opportunities arise.
We will be communicating regularly over the next few weeks with different fund managers commentaries in order to provide a balance to the doomsday scenarios being reported in the press.
Close Brothers Market Update:
Equity markets have continued to fall precipitously over the past few days, despite a brief rebound last Tuesday. The FTSE 100 is now down 9% for the year, while in local currency terms, the S&P 500 is down 10%, the Eurostoxx 50 has lost 12% and the Nikkei is down 13.75%.
Oil is down 25% since the year began. Meanwhile, Pound Sterling has lost between 4 and 7% against major currencies....Read the full Close Brothers market update report here.
Cornelian Market Update:
Having reduced equity exposure meaningfully across all the portfolios during the first half of 2015, we are alert to potential investment opportunities during this indiscriminate sell off, and indeed have started to dip a toe into areas of the market where we see real value emerging.
Nonetheless, given the uncertainties confronting the global economy, we remain cautious....Read the full Cornelian market update report here.
If you have any questions please contact the office so that we can discuss your personal situation.
Tel: 01727 85 22 99
Email: mail@kdw.co.uk