Market shocks present reasons not to invest but you could miss out

Posted on

When you read the news, it’s often filled with reasons not to invest. From the 2008 financial crisis to the UK leaving the EU, you may have approached investing with some trepidation. But choosing not to invest for these reasons alone means you’re likely to have missed out on long-term gains.

Research from Schroders shows there’s been a reason not to invest every single year over the last three decades. The coronavirus pandemic caused volatility and concerns in 2020, which may have put some investors off. The reasons highlighted in the research show just how many factors can have an impact on the markets, from war to banking crises. It’s not surprising that some would-be investors can get nervous after reading the news or seeing short-term volatility.

Investors benefit from 5.6% annual growth despite the dips

If you glance at the list of reasons not to invest, you may think investors have lost money. But despite the volatility they may have experienced, investors are likely to have benefited.

The research found that after adjusting for inflation, those invested in the FTSE All-Share index would have received average annual growth of 5.6% over 30 years. If you’d invested £1,000 in 1989, you’d now have £5,751. In contrast, those that put off investing and opted for a savings account are likely to have received an average growth rate of 1.9%. That would leave savers trailing behind investors with their initial deposit now being worth £1,818.

If you’re looking for the “perfect” time to invest to maximise your returns, you’re unlikely to find it. With so many different factors influencing global stock markets, there will always be a reason not to invest. Instead, the right time to invest is when it suits your situation and plans. Investing is a long-term decision and, as the figures demonstrate, when the peaks and troughs even out, they can deliver gains despite what you may read in the headlines.

Setting a long-term plan is crucial, but it can also be a challenge to stick to it, especially when you hear about trade wars, an economic crisis, or a market bubble.

5 tips for holding your nerve amid market volatility

1. Don’t check your investments every day

As tempting as it can be, avoid looking at your investments every day, or even every week. Your portfolio will experience up and downs that can seem dramatic when viewed as a single event. Instead, set out clear review dates when you’ll assess the performance of investments.

2. Focus on the bigger picture

Linking with the above point, rather than focusing on the day-to-day movements, look at the bigger picture. If you’re investing for a retirement that’s 20 years away, short-term volatility is likely to have little impact on your end goal. With a wider view, you’ll be able to see an overall trend.

3. Screen out some of the noise

It’s easier than ever to get information on what’s happening in the markets and what could have an impact. While useful, it can also make it tempting to diverge from your investment plan. It’s impossible to avoid all news in the modern world, but taking steps to screen out some of this can help reduce the risk of making decisions based on short-term volatility.

4. Avoid knee-jerk decisions

You can often make changes to your investments or withdraw your money with just a few clicks on your computer or phone. It’s convenient, but it also means you can make large decisions that could have a long-lasting impact without taking the time to fully think through your options. Before you make any changes to your portfolio, it is advisable you take a step back to assess the situation in the context of your goals.

5. Get in touch with us

Sometimes if you’re nervous about market movements, some reassurance can help put your mind at ease. As your financial planner, we work with you to create a risk-appropriate investment portfolio that’s aligned with your goals. During times of volatility or if you’re concerned, we’re on hand to help give you confidence and discuss if investment changes would make sense for you.

Please note: This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.

The value of your investment can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.

 

We aim to keep our clients up to date on interesting and relevant financial news.

You can sign-up to receive our monthly newsletter by email, even if you’re not yet a client. Sign-up using the form below.

Client testimonials

I have always found Black Swan to be caring and understanding of my quirky lifestyle. I always feel they try to get me the best returns while respecting my current needs.

Sally Muir

A client since 2011

We would be very happy to recommend the support and service we receive.

Valerie Locks

A client since 2010

I have always been completely useless regarding finance - thankfully our financial adviser is not! I've retired with far more than I ever expected and investments continue to grow safely. So - thank you!

Bernadette Jane Warner

A client since 2000

Very happy with the professional service I have received and feel a lot happier now with my finances put in order.

Martin Field

A client since 2011

Julie Cooper was recommended to me by a work colleague. She has been very helpful, professional and has explained everything well. I would definitely recommend her services to anyone else who are interested in a financial review.

Steven Rooke

A client since 2018

…Service has been first class.

Hugh Fells

A client since 2012

My face to face meetings with Rob Young and Jessica Lyons have always been very open and understandable. My questions have been answered clearly and I have left feeling that my financial matters are in good hands.

Sandra Jack

A client since 2000

[A] safe pair of hands in a complex financial world.

Gary Middlehurst

A client since 2003

A reliable company with good communication skills and good knowledge of the financial markets.

Alan Evetts

A client since 2014

Maureen Pembridge is a long-time trusted advisor to our family. The market might fluctuate but her attention to detail is consistent.

Linda Burnard

A client since 2000

I am pleased to recommend Julie as a trustworthy financial advisor. She explains financial jargon in plain language, and always listens carefully to my particular financial needs and has helped me make the best of my savings.

Carolann Samuels

A client since 2010

I have always been satisfied with the way that Black Swan has handled my account. And I have always found the staff very helpful whenever I need to call the office.

Robert Anthony Matthews

A client since 2012

An excellent personal service from a person I know and trust.

Michael Dalton

A client since 2010

I am getting a very good services from Black Swan, they have got my investments sorted out which was in a bit of a mess.

Roy Jakens

A client since 2012

A good, efficient team providing clear ideas to shape a winning strategy.

Adrian Michael Levenstein

A client since 2011

Black Swan is a company to be trusted, with friendly staff and professional advisors.

David Brian Jennings

A client since 2017

I have been with Black Swan for many years. I have never wished to change anything. They give a good straight forward service.

Martin Barrett Brooks

A client since 2010

Andy Peters has been invaluable in firstly combining several pension pots and then giving excellent investment advice. It has given us a great deal of comfort to know that our financial affairs are in such good hands.

James Guillum Scott

A client since 2014

I find my financial advisor easy to talk to and feel that she understands my lifestyle. She is always available for help when I need her and explains in words that I can understand.

Margaret Ena Glasgow

A client since 2000

Andy is a first rate Director, excellent communicator and leader.

Ross Perry

A client since

Black Swan Financial Planning and Andrew in particular, are very clever at working out how risk averse we are, and coming up with solutions that we feel comfortable with. We are happy in the knowledge that we can continue to enjoy a comfortable retirement. Andrew Peters is a very, very friendly person who is great to chat to and easy to deal with. He explains things very clearly in layman’s terms, and if we still don’t understand, he explains it until we do!

Alan & Jane Dyer

Clients since 2012

We have always found Rob [Young] to be very approachable and knowledgeable. We have every confidence in the advice given and feel comfortable with the decisions we’ve made. There are certain opportunities that we wouldn’t have known about if Rob hadn’t brought them to light, which makes the advice good value for money as far as we’re concerned.

Peter & Pauline O’Halloran

Clients since 2013

Rob [Young] is extremely knowledgeable. I knew nothing about the different types of trusts which will not only secure my income in retirement, but also leave a legacy for my children. I’m glad that I sought his advice when I did.

Sarah Wilson

A client since 2015

I am extremely happy with the service afforded to me by the company and my adviser Julie Cooper.

Geoff Coxell

A client since 2010

My wife and myself have been dealing with Black Swan for a number of years. We have met with different representatives from the company over the years and have found all very helpful in their own way. We met with James [Anderson] a few years ago and found him very helpful and knowledgeable. He keeps in contact with us on a regular basis. We find the Company information very helpful and we feel very secure with our finances.

Andrew Kirchen

A client since 2015

I have always found my adviser to be easy to contact, very professional in his approach, yet friendly and understanding. I have a sense of an experienced company behind him, really on the ball financially and with good standards.

B McBean

A client since 2011

Partner with the most reliable and experienced team of advisers

Enter your details & we'll be in touch to discuss your needs.
Alternatively, contact us directly and speak to a member of the team.





    Subscribe to our newsletter