There’s always something that can potentially affect investments. However, if you follow our tips, these could help you look after yours no matter what’s happening in the world.
Don't try to time the market
No-one can predict what the markets will do next. Selling your investments when prices have fallen could result in a permanent loss. Fund managers work hard to exploit these downturns in the market to ensure your investment makes the most of any opportunities during uncertainty.
Consider regular investments
By investing on a regular basis, you'll buy assets at a different price each time you invest. This can help smooth out the impact of the highs and lows of market movements. Regular payments into your investment may help increase the chance of purchasing assets at a low price.
You might want to consider phasing any withdrawals you need to make
If you know you’ll need access to your money in the next 6 months, doing this gradually may help, as values can change in a short period of time during volatile market conditions. Plus, phasing any withdrawals can also help minimise the inconvenience of being unable to access your money if a fund temporarily suspends trading. This can sometimes happen in a volatile market, as it allows funds to dispose of assets in an orderly way, protecting remaining investors in the fund. This is quite common within property funds, where the underlying assets aren’t easily tradeable and take time to dispose of.
A well-constructed investment portfolio can help minimise investment volatility. The key is ‘diversity’. This means investing with different assets and fund managers. Or invest in a single fund like our Primary Fund range, which will do this for you. It invests in different underlying funds, within different asset types, across a range of geographical regions and fund management styles. In other words, you won’t be putting all your eggs in one basket.
Make sure your investment plan is up to date
Your investment plan or strategy should be in line with your tolerance to risk, ability to absorb loss, time horizon and investment goals. Making sure your plan is current may help you ride out any unpredictability.
For this reason, it's important to regularly review your investment portfolio and change any parts of your investment strategy, if necessary. For example, you may decide to put off that planned purchase until a later date when market conditions have settled. Or it may mean considering a different approach to risk.
We're here to help you achieve your financial goals. So if you still have any concerns or questions either about your portfolio or investment plan, please contact a Financial Planning Manager. They will be happy to speak to you about your options, and make sure your investments remain right for you.