Market Update: Bear market fear as another tech bubble deflates
To some investors it will seem the old investor adage of ‘Sell in May and go away’ has once again proven correct, especially when the US S&P500 fell within touching distance of that bear market threshold of -20% last week. However, what makes this particular market correction different to others experienced since the pandemic is that it has disproportionally affected those risk assets considered safe havens when economic growth prospects faltered – namely US tech mega caps and other tech names quoted on the NASDAQ.
Market Update: Market noise is almost deafening
The last week of April was like being on a roller coaster. We had rather hoped that the ride was almost over, but in fact it’s only been getting wilder. For the past five weeks, the asset markets have been displaying greater volatility. These charts area way of demonstrating the phenomena we term asset market “noise and loudness.”
Spring Team News
With Spring in full swing, we want to wish you all a happy new tax year! The team at Vizion have been very busy over the last few months and we are excited to share our staff news with you.
Market Update: Range bound markets – despite the drama
Equity markets have been range-bound through the past few weeks, but it does not feel like it. Volatility is at its highest since the nasty period in March 2020, which always raises our perceptions of potential downside. But the volatility is not too surprising given the overall mix of news and economic data updates.
Extending The Scope of the Trust Register
Trusts are a way of managing wealth, money, investments, land or property, for you, your family or anyone else you’d like to benefit. When you put assets in a trust, they are under the control of an appointed person or persons called ‘trustees’. The trustees then manage the trust according to your instructions, even after your death.
Market Update: Spring In The Air?
Surprisingly positive corporate sentiment data across Europe last week indicated that consumer demand may not be as significantly impacted by the war in Ukraine as markets had been pricing in. On the other hand, there are signs in the US and the UK that consumers are feeling rather more pressure on their household budgets from rising energy and housing prices than anticipated.
Market Update: Easter Review and Outlook
The annual rate of inflation, as measured by the consumer price index (CPI) was reported at 7% in the UK, 8.5% in the US and even Germany recorded 7.3%. These are heights not seen for 40 years and were unsurprisingly front and centre of this week’s news flow. While equity market investments have historically demonstrated their inflation-hedging characteristics, the fact that investors appeared to shrug off these new peaks may well point to the belief that this is about as high as inflation is likely to get.
How Much Do I Need To Save To Retire?
The question, ‘Have I saved enough to retire?’ is a dicult one. It requires a lot of information about you, your family, your income needs in retirement, and an understanding of the various financial vehicles available for saving and investing before it can be answered definitively.
Market Update: Q2 Begins with QT Top of the Agenda
In aggregate, global markets have managed a decent enough bounce since the onset of Vladimir Putin’s invasion of Ukraine. Indeed, the awfulness of the news from the area has ceased to impact markets greatly. We have returned to worrying about the resurgence of COVID-19 in China, along with its impacts on the global supply chain and on overall global growth, and worrying about the US Federal Reserve (Fed) and its plans for tightening US monetary policy.
Market Update: Yield curve inversion – no April fool
While UK consumers braced themselves for a surge in their cost of living – as the UK’s energy price cap resets and rises a staggering 54% – investors experienced a quieter week, which once again saw gains in equity markets, while bond market valuations suffered from rising yields.
Lasting Power of Attorney
As someone becomes more unwell, they’re likely to find it more difficult to manage money and financial affairs, and may become too unwell to make decisions about health and care. A Lasting Power of Attorney (LPA) is a legal document in which someone (the donor) gives another person (the attorney) the right to help them make decisions, or take decisions on their behalf.
Market Update: Bank of England the only fan of Sunak’s spring budget?
Budget announcements are inherently political affairs. Even so, Rishi Sunak’s Spring Statement was a particularly political broadcast. The Chancellor talked up the 5p per litre cut to fuel duty with the fervour of a vegetable market stallholder (By contrast, Germany just slashed a litre of petrol by 30 cents), as he did with the rise in the National Insurance Contributions threshold. Reminding MPs of his avowed fiscal responsibility, he noted the fuel tax cut would last for only one year.
Spring Forecast Statement 2022
Chancellor of the Exchequer, Rishi Sunak, delivered his 2022 Spring Statement on 23 March, confirming implementation of the politically contentious 1.25 percentage-point rise in most National Insurance contributions, though with revised thresholds to mitigate the impact. He declared that his overall plan “builds a stronger, more secure economy for the United Kingdom.” The fiscal update included a number of specific measures and a new ‘Tax Plan’ which the Chancellor said would help families with the cost-of-living squeeze. Mr Sunak said, “People should know that we will stand by them, as we have throughout the last two years.”
Market Update: Changing Tides…
Last time we reminded portfolio investors of the importance of making sure that long-term investment decision-making is not overly influenced by short-term market fluctuations. At Vizion Wealth, we aim to ensure portfolios remain positioned appropriately, and are fine-tuned when medium-term changes in the economic and market outlook either necessitate adjustments or indeed present new opportunities.
Market Update: Market and investment activity update
For the last few weeks, we have regularly had to caveat our commentary with the phrase “as we write”. The chart below shows how much the German DAX benchmark equity index (which tracks the top 40 German companies) has on average moved every 30 minutes over the past year:
Market Update: A Double Edged Sword
During the course of last week, the impacts of the war on global financial assets changed in nature. Over the past weeks, we wrote that minor sanctions were a help for asset prices even if the sanctions did not match the level of outrage. Starting last Sunday, the European Union (EU), US and UK imposed new sanctions almost every day. Perhaps inevitably, this has resulted in equity market weakness.
Market Update: Back to the Past
As this week’s title suggests, for some of us it invokes memories of the cold war era of the West vs the USSR in the ‘70s and ‘80s. It is even more remarkable then, that at the time of writing, stock markets have rallied back to roughly where they stood this time last week. The same cannot be said about Russian asset prices, which have roughly halved since last autumn as the chart below illustrates. Perhaps this indicates who markets believe will ultimately pay for Putin’s megalomania.
Special Market Update: Russia Invades Ukraine
Given the devastating news today, we would like to express our utmost concern for the people of Ukraine and of course, our thoughts and wishes are with them. It is our duty as advisers to comment on the economic and financial impact of geopolitical news, but we do so with the utmost respect for the broader context and the devastating impact the current situation is having on people’s lives.
Diversified Portfolio
Even if you are a sophisticated investor, one of the most important tools available is diversification. Whether the market is bullish (rising) or bearish (falling), maintaining a diversified portfolio is essential to any long-term investment strategy.
DPMS Portfolio Commentary
To guide our decision-making whilst managing the preservation and growth of your investments, the Vizion Wealth Investment Committee anchor in on the underlying mechanisms within economic markets. Throughout history, markets have consistently shown themselves to follow a regular path; the economic cycle. Although we are currently facing a period of downturn, which can naturally be anxiety inducing when reviewing portfolio performance, a point we can anchor in on is that markets will regain.