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Coping in Volatile Times

Investment markets have been extremely volatile over the past 3 months with the Australian Share Market falling approximately 33%, followed by a 22% recovery.

It is important during this time that you continue to be rational and appreciate that the share market is there to serve you and not to instruct you.

Imagine if a random stranger came knocking on your door, asking you to sell your home to them at a far reduced price. The rational reaction is to remain calm and tell the stranger to get off your doorstep.

Yet many people don’t act this way and sell perfectly good assets at reduced prices.

The stock market is the only thing that I can think of where people sell at a discount and buy at a premium and it is simply a device which transfers wealth from the impatient to the patient.

In the background we have a clear understanding of what your assets are worth and will only recommend you sell these assets at a premium or if you need the money. We will also be recommending you continue to acquire assets at low prices.

There are no secrets in investment markets and success is based more on qualities of temperament than qualities of intelligence.

I would expect a lot of volatility in the months to come as the world grapples with employment issues, a coronavirus vaccine, government stimulus and debt issues.

It is important to understand that these issues will eventually become distant memories and should not influence your long term goals and aspirations.

Want to talk more about your investment goals? Contact us