UnaVida | Investment fears in Berkshire

Investment fears in Berkshire

Investment Fears in Berkshire

We have received many calls from followers of our blog regarding the state of the investment markets, the reason being that the media is making comment on the possible collapse of investment markets.

The 30th anniversary of the 1987 crash is just ahead, however looking back to that period, the market at that time was running way above the long-term average. Now, however, the investment markets generally are not at huge valuations (except of course, the US market).

Before we all breathe a sigh of relief, one needs to take note that there are several factors that could create the right conditions for a correction. There have been widespread purchases of investments “on margin” mainly by the banks AND widespread indiscriminate and substantial purchases of ETF investments.

Although the investment markets have risen at a gradual pace, any correction if it does occur could give rise to a massive drop in the investment markets, as the banks’ would need to bail out quickly to cover their margin calls, and ETF investors take fright.

Many investors panic when investment markets collapse, as they mistakenly believe that the temporary declines in the price of their investments lead to a permanent loss of value.

Providing your portfolio is well diversified, then you should be OK, unfortunately many portfolios are not.

Major market declines are often followed by market advances which erase the previous decline and over time lead the market to new highs.

So the real price you pay for investing in equities is the worry and uncertainty when the market is in a period of decline. Your reward, provided you hang on in there, is increased levels of dividends and capital growth.

It is important to ensure your portfolio is highly diversified – if you are losing sleep give my PA Marie a ring us on 01189 347 920 or via out contact page and we will see if we can assist you.

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A pension is a long-term investment that typically cannot be accessed until age 55 (57 from April 2028). The level of pension benefits offered could change depending on the value of your investments (and any income they may generate).

The interest rates in effect at the time you begin receiving benefits may also have an impact on your pension income. The tax consequences of pension withdrawals will depend on your unique situation. In later Finance Acts, tax rates, tax bases, and tax relief may change.

The opinions expressed by Ray Best are meant to inform and educate. Before making any investment decisions always take advice that is pertinent to your investment personality and financial situation.

You are aware that past performance will not necessarily be repeated in the future, but you should be aware that persistent poor performance invariably will.

The value of an investment and the income from it could go down as well as up.

The return at the end of the investment period is not guaranteed and you may get back less than you originally invested.

UnaVida Wealth Management Ltd. is directly authorised and regulated by the Financial Conduct Authority (440577).

The guidance in this website is primarily aimed at a UK audience and is subject to regulation by the Financial Conduct Authority (FCA).

The Financial Conduct Authority does not regulate tax planning, estate planning, or wills and any form of legal documentation.