Skip to main content
#
A Clear Direction
rss feedour twitterour facebook page linkdin
home
Financial Advisor Brisbane - AdviserScott Keefer - A Clear DirectionBuilding Investment PortfoliosPortfolio Management ServiceUpdated ContentContact Us - Brisbane Financial Planning
A Clear Direction Financial Planning logo

 Financial Happenings Blog 
Monday, May 25 2009

The latest edition of the Monday's Money Minute podcasts has been uploaded onto the website - Taking Stock - What Should Investors Do Now?

The following provides a transcript of the podcast:

In this edition of our podcasts I wanted to provide a simple update on the movement of markets so far in 2009 and then turn listeners attention to considering what their response should be to the current climate.

 

To the end of last week - 22nd May - we have seen the following performance in share asset classes:

 

         Australian shares are now up 1% for the year, up 20% since the bottom reached in early March

         Australian listed property still down 26% for the year but up 17% since the bottom.

         International listed property is also still down 19% for the year but up 16% since the bottom.

         International shares up 2.5% for the year and up over 30% since the bottom.

         Emerging Markets are now up 27% for the year so far, up 38% since early March.

 

As I always profess - as my family and closest friends can confirm - I have no idea whether markets will continue this projection in the short term.  There is still potential for "icebergs" to create more havoc such as the downgrading of the UK's or even the US credit rating.  Let's hope the global economy can avoid these icebergs but we should be prepared for this.

 

So What Should Investors Do Now?

 

For clients and regular visitors to A Clear Direction's website you will be well aware that I currently favour the use of Dimensional Fund Advisor investments within portfolios.

 

Last Friday, Dimensional have uploaded to their public website a really useful series of online presentations done by Weston Wellington, Vice President of Dimensional in the United States.  The series is titled - What Should Investors Do Now?


The presentations are 68 minutes in total length but well worth sitting through.  Weston covers Dimensional's approach to managing money under adverse business conditions, looks at how recessions affect share prices, explains why many did not see the problems in share markets coming, compares the recent downturn with previous downturns, considers whether government intervention is a threat to capitalism and concludes by suggesting what investors should do now.

 

Summarising the concluding comments:

  • Diversification remains important.
  • If you have less borrowed money, are less affected by the recession, and have a longer time horizon than the average it makes sense to buy.
  • If you have more borrowed money, are more affected by the recession or have a shorter time horizon, it might be the time to sell.
  •  If you are about the same as everyone else, do nothing and relax

These are very general rules of thumb that hold some merit.  However each individual's approach will be more complex given individual circumstances, risk tolerance and goals.  If you wanted to spend time discussing your individual response to the current economic and investment climate please do not hesitate to be in contact.

Have a great week!!

 

Scott Keefer

Posted by: Scott Keefer AT 08:00 pm   |  Permalink   |  Email
 
Scott Francis' articles in the Eureka Report 
Request for Information 
If you have questions, or would like more information, please go to our Contact page and leave your name and contact information.

Plan Well, Invest Well, Live Well! Financial advice providing a clear direction

A Clear Direction Financial Planning and Portfolio Management ABN 85 147 572 870

Level 19
10 Eagle Street
Brisbane QLD Australia
Ph: (07) 3303 0269
Email: scottk@acleardirection.com.au

Authorised Representative (398444) and Credit Representative (403292) of FYG Planners Pty Ltd AFSL/ACL 224 543.

ASIC - Financial Advisers Register

All content of this website is copyright © A Clear Direction Financial Planning Pty Ltd, 2017

FYG Planners Pty Ltd & A Clear Direction Financial Planning Privacy Policy