Tuesday, 9 August 2011

It's important to remember that we all invested for the long term and not to panic...

Dear Investors

You will no doubt have been observing with interest (all be it morbid) the latest developments on the world markets (not to mention the riots).

Significant falls in the value of shares has proven to be something of a worry to all.

I thought I’d send a brief message intended to reassure.

It is important to remember that we are all invested for the long term and that this means riding out fluctuations when they come.

It is a common mistake for investors to run for the hills when trouble strikes, meaning that when the inevitable recovery comes, they miss out....and often these reactions mean we leave the market after the horse has bolted. Hence there is a danger that people turn to cash investments when the market has already fallen - only then to be out of the market when the inevitable rally comes.

If anything, these falls in prices represent an opportunity for those with long term plans to place further money into the market and therefore benefit in the long run.

I have taken the text below from Citywire which seems to suggest that we have reached the bottom. Of course I do not know whether this is the case but I found this information encouraging and hope you do to.

If you have any worries or concerns about the current situation please do not hesitate to get in touch.
After enduring their worst session since the depths of the financial crisis, US equities are poised for lift, with futures pointing towards a rally on the opening bell.

The Dow Jones Industrial Average - a key indicator of the future direction of trade - is hinting the sell-off will halt during Tuesday's trade as fearful investors await a decision from the Federal Reserve on rates and additional easing.

With around two hours before the opening bell the index is pointing towards a 1.8% rise when trading begins on hopes that the US rates will include details on a new round of quantitative easing. Also consumer sentiment was given a boost by oil's dip beneath $100 a barrel, a six month low.

The prospect of a more upbeat session across the pond has also raised hopes of an end to the equities sell-off in the UK, leading the FTSE 100 to climb to 5,051 after spending much of the session below the 4,900 for most of the day and 20% below its July peak.

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