Australians have been warned not to “panic sell” their shares and make rash decisions following a disastrous week on the nation’s share market.
Six Park director of business development Ted Richards told the Herald Sun if you had a long investment horizon and were aware of the risks, “stay invested and ignore the noise”.
“The fog of vocality can make investors veer off course in their investment goals,” he said.
For younger Australians in their 20s and 30s, there’s certainly no reason to stress about the state of the stockmarket in the short term, but instead to rethink your financial strategy, Mr Richards said.
He believes long-term investment plans are key, not short-term ones.
“If we are talking about millennial investors and they are trying to get into the property market they should have more of a conservative portfolio that won’t have the volatility of the stock market,” he said.
“You would want a much larger allocation in your portfolio to defensive asset classes like cash, bonds, fixed income and infrastructure as opposed to Aussie and international equities.”
The reason being the returns are lower but the risks are far less.
This article also features commentary from InvestSMART and JBS Financial Strategists.