In the last six months, the Australian Share market dropped 15%, recovered by about 9% and then dropped another 10% and has since risen 5%.
Russia is continuing to bomb Ukraine. Many European countries are not sure where they will get their energy to keep themselves warm during winter. China is still trying to achieve COVID zero and has lockdowns in many cities and towns. OPEC has decided to reduce oil production which will more than likely increase the price of petrol. Inflation is running rampant, with Germany recording 10% and the USA nearly 9%. Many countries are either in or will soon be in a recession.
On a local level, many parts of Eastern Australia are experiencing floods. The restrictions around COVID have been pretty much removed. The Reserve Bank is increasing interest rates to reduce how much we have to spend to try and stop inflation. The Government is continuing to commit to the next stage of tax cuts which will give us more money to spend. House prices, especially in the major capital cities, continue to fall. Qantas is expected to make its first profit for a few years.
With all of this going on, it is no wonder people, including professional investment managers don’t know what the market is going to do in the short term.
Here, and in the next article, I am going to outline the things you need to do to manage your investments in times of increased volatility.
Here’s the first 10 things to do to manage your investments in times of increased volatility.