After the great returns of last financial year, the 2021/22 year has begun strongly. However, as reports of potential headwinds for the market are appearing in the news, I wanted to touch base with a reminder of the power of taking the long view.
Short-term market events tend to grab headlines, but for investors it’s the long-term story that really counts.
I’m coming up to my 23rd year as a financial adviser. In that time I’ve seen plenty of market fluctuations, and for some of my clients, it can be easy to react emotionally to market movements.
By looking at how markets have performed over time, we can place our current market situation in context and appreciate how our investments can grow in the long term.
Every year Vanguard, one of the world’s biggest fund managers, releases an index chart which graphically captures 30 years of Australian and global investment market history, overlaid with significant world events.
It’s a busy, but interesting read – and you can see that while markets do fluctuate, asset values have steadily increased over the last 30 years. So, while unexpected global events may take place, we can stay in control of what matters: our long-term investment strategy.