Calibre clients can be confident that the strategies we deploy and the portfolios we manage are designed to withstand the inevitable bouts of volatility that come from a future that will always be uncertain.
You might expect to feel excited when your investments perform well or disappointed when they fall in value but there’s a wave of other emotions that most of us experience in response to market conditions.
Put simply, a key principle for successful long term investing is to buy low and sell high. But more often than not, investors do the exact opposite. The reason? Investors are human. For example, many panic and cash out when markets fall. Ironically, at these times, these investors fail to recognise they are actually at the point of maximum financial opportunity.
In the current climate, what this means for our clients is that as markets fall, we often take the opportunity to strategically rebalance portfolios back to target weights. This disciplined rebalancing approach means we are regularly buying low priced assets and selling higher priced assets. History has shown this is the best way to protect and grow our clients’ wealth so you have the highest chance of achieving your goals.
Please find attached a useful chart from Russell Investments which helps illustrate the points made above. Read more
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