What does this mean for your investments?
It’s important not to panic when you see your investment account balance falling. Investment funds are generally intended as long term investments, so if you can stay invested, you should be able to recoup any recent losses.
The graph below shows that even when markets have taken a real knock, such as during the Global Financial Crisis when the US share market fell by over 50%, they can bounce back over time3:
Despite the concerns that are hanging over financial markets, global economic growth is strong and we believe the fundamentals for share market performance remain in place.
We are of the view that once some of the current uncertainties (such as trade negotiations and Brexit) have passed, global growth will continue, albeit at a slower pace than what we’ve seen in the immediate past.
It’s also important to remember that falls in share markets provide good buying opportunities for active investment managers, such as the team at ANZ Investments. Our team continues to monitor the situation and has used the recent weakness in financial markets to buy into those areas of the market, and companies, which now present better value.