Stay the Course - Investment Advice

Despite the ongoing conflict in the Middle East, investment markets have rebounded strongly since early April, reinforcing the importance of staying the course.

Short-term volatility is a normal part of investing, and reacting to market downturns by moving to cash or similarly conservative funds can be costly over time.

Studies back this up.

Based on US stock market data over the 10 years to 31 May 2024, a $100,000 investment would have grown to $229,000 if it remained fully invested. Missing just the 10 best days reduces that outcome to $164,410, while missing the 30 best days brings returns close to the original investment.

Importantly, many of the best days occur during periods of heightened volatility, often alongside the worst days, making them extremely difficult to predict.

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