Could You Fall In Love With Volatility?

investing volatility Feb 27, 2021

The last year has seen HUGE volatility in the financial markets and things may stay this way for a little longer. However, in the last year, I can count on one hand the number of clients that called concerned. Hopefully, they have comfort in the fact that their money is invested for the right reasons, in the right things and that their investment risk perfectly matches their appetite for risk. However, this isn’t always the case for self-investors or those with a pension pot that is not professionally managed. So how do you prepare your investments and pensions so that you can have a good night’s sleep?

Have you got the right investment for your risk? If it is a work pension that you have, spend some time on the website looking at your investment options. There should be a booklet which shows you which ones are suitable for you.

Make sure that you are taking the right level of risk. When you are young, you want to be taking the most amount of risk that you feel comfortable with when it comes to retirement planning. This is because you have a long time until you can touch your pot – i.e. decades!! If you are investing (say in an ISA) for a more medium term goal then you need to make sure you are taking the shorter term risks into account. A lot of my clients have different risk ratings for their ISAs and pensions for example. You might find this useful -

Don’t have all your eggs in one basket. If your investments are well diversified across the world and across different types of investments then a dip in one market won’t have such a huge impact on your pot. If you don’t know where to begin with this you might want to start researching multi asset funds.


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