It was a rollercoaster week. Here’s the daily gyrations of the S&P/ASX200 – just for last week:
- Monday 5 February: -1.56%
- Tuesday 6 February: -3.20%
- Wednesday 7 February: +0.75%
- Thursday 8 February: +0.24%
- Friday 9 February: -0.89%
Down, down, up, up, down. It’s been a long time since we’ve seen any real kind of volatility.
This is the biggest dip since 30 June last year when the index 1.7%. And in fact, 2017 was a year of unusual calm in all major share and bond markets around the world.
Volatility’s return from its slumber is a salient reminder that sometimes markets are crazy – and that volatility is a normal part of investing.
You may be wondering what the future holds and if you should make changes to your portfolio. (You probably know we’re going to tell you not to react!)
The boring and honest truth is that a few (even large) down days is probably not going to change a thing for you as a long-term diversified investor.
In fact, reacting emotionally could harm your investment performance more than the market dip itself.