Markets have been volatile recently—both equities and bonds. Volatility can be uncomfortable for many, but the good news is that markets have historically recovered after falls*. We saw this after the fall in equities in February 2020 when the COVID-19 pandemic started.
Our Investment team here at UniSuper is well placed to handle market volatility. We manage over 70% of funds in-house across all major Australian and global asset classes with deep expertise across our team.
Trading off risk and return
Riding the ups and downs of financial markets is part and parcel of investing. History shows that assets that are more likely to fluctuate in value over short periods generally deliver higher returns over the long-term*.
Let’s compare shares and cash. The chart below illustrates how the two asset classes have performed since 2000.
Focus on the long term
While volatility can be stressful, it’s important to take a long-term view. Even people transitioning to retirement — or who have retired — may be investing for many years. So be patient, maintain perspective and be sure to seek advice if you need it. If you’re thinking about changing your investment strategy, some useful questions can be:
1. How much longer will my funds be invested?
2. How much risk am I prepared to take?
3. Is my investment strategy right for me?
One of our financial advisers, Derek Gascoigne, shares his thoughts on these considerations and on navigating market volatility.
If you need help, talk to our award-winning financial advice team. Simply make an appointment or call us on 1800 823 842 for more information.
Stay informed on what’s happening in markets and the economy
Our monthly investment podcast with our lead economist David Colosimo gives a snapshot of economic and market activity. We release these podcasts at the start of each month. Subscribe via Apple Podcasts, SoundCloud, Overcast, Stitcher, or wherever you get your podcasts or visit the podcasts page on our website.
Chief Investment Officer John Pearce also shares his insights in his regular investment update videos, watch his latest video.
You may also be interested in:
In his newest video, Chief Investment Officer John Pearce talks about the latest in financial markets and what’s been driving investment performance.
We chatted with financial adviser Derek Gascoigne about navigating investment choice amid market turmoil.
Retirement isn’t an ‘all’ or ‘nothing’ event. Whether you’re still working or dialling down, when it comes to your investments, the choices you make can make a difference.