The global economic and geopolitical landscape remains unpredictable, but staying focused on a clear investment plan, diversifying assets, and controlling what we can - like saving and managing risk - helps navigate the noise, ensuring steady progress toward long-term goals despite ongoing challenges.
The last 5 years have given us several major events that have dragged the world every which way. The global economic narrative is replete with dangers and conflicts including the pandemic, extreme weather events, the Ukraine war and the widening skirmish in the Middle East. In the last couple of years, inflationand the high cost of living have added to the challenges facing both governments and households.
Most recently the return of Trump to the US presidency has dialled up the uncertainty: how will the global economy and geopolitical landscape be affected?
So how do we deal with the ebbs and flows of the share and bond markets that often reflect these events, and in turnbear upon the value of our investments? Whether it’s up or down, our response is the same: ‘this won’t last.’ Indeed, after being in the doldrums, the NZ share market has seen an uptick this year, a gleam perhaps, indicating a nugget of business confidence.
Fool’s gold? On any given day we can easily find commentators who insist that things are looking up...or down. The day-to-day noise is confusing and frequent scrolling through the latest share prices is likely to instil a jittery, and highly reactive perspective.
Instead, here are some words of wisdom gathered from our experience.
Let the markets do the worrying.
Focus on things that you can control including how much you can save, how much investment risk you are willing to take and how to diversify your assets.
Markets are adaptive and quickly respond to new expectations.
Prices instantly reflect new information. Think back to 2020 when the pandemic hit and how quickly things turned a few months later when vaccines were developed.
A clear plan provides certainty.
Know that you have a plan in place and that we are on the journey with you – keeping an eye out for any changes that might affect you.
Our client portfolios are well diversified,
so we are not heavily betting on one sector or one country to perform. We design portfolios that meet your income and growth needs, and for your circumstances and stage of life.
Next year the global and local economies will undoubtedly prove to be just as messy. Geopolitical tensions will not go away in a hurry. Regardless of the challenges ahead we look forward to helping you navigate toward your lifetime goals.
And despite all the surrounding bad news, our client portfolios will finish the year on a positive note. Let’s also rejoice that New Zealand is half a world away from the major conflicts we see on our news feeds. We need to count ourselves lucky.
