We appreciate that the recent volatility in global markets may be causing concern, and we’d like to take a moment to provide some clarity.
What’s Happening in the Markets?
Global markets have fallen recently, partly due to renewed tensions around the Trump-era tariffs, which, as an opening position, were significantly larger than anticipated. These trade disputes are creating economic uncertainty and investor nervousness. While unsettling, it’s important to remember that such fluctuations are a normal part of market cycles, and typically exaggerated in the early stages of a sell-off.
Avoid Knee-Jerk Reactions
In times of crisis, the temptation is often to “head to the hills” and sell off investments in fear. We know from behavioural finance that we are wired to be loss-averse, and the pain of a loss can feel much more intense than the pleasure of a gain. Our message remains clear: Do not run. Stay invested. Reacting impulsively can lock in losses that could otherwise be avoided. History shows that staying patient during times of uncertainty often leads to better long-term outcomes.
A Driving Analogy: Focus on the Long-Term
Think of investing like driving. If you only look six inches ahead, you’re likely to get into trouble. You need to focus on the road ahead, be aware of obstacles, and if the view is unclear, it’s better to pause and wait for better clarity. The current market uncertainty is one such obstacle, but it’s temporary.
Investment Rebalancing
Given the current market volatility, we have decided to pause all investment rebalancing until the market conditions stabilise. This is a precautionary measure to avoid making any changes during uncertain times. We’ll continue to monitor the situation closely and will re-assess once the volatility reduces.
Staying Focused on the Long-Term
Investing is about patience. While short-term movements can be unsettling, history shows that sticking to a long-term strategy typically leads to better results. We remain confident that your portfolio is positioned for long-term success, and those who stay invested will be best placed to benefit when the market recovers.
As always, we’re here to support you. Please don’t hesitate to reach out if you have any questions or would like to discuss your portfolio.
Thank you for your continued trust.
Douglas Kearney C.A. Investment Director
The above article is intended to be a topical commentary and should not be construed as financial advice. Past performance is not an indicator of future returns. Any news and/or views expressed within this document are intended as general information only and should not be viewed as a form of personal recommendation.