When Covid-19 became our lived reality two years ago, we witnessed a lot of volatility in investment markets. Share prices were extremely unpredictable, and the value of investments dropped sharply in the first quarter of 2020. However, this was followed by a remarkable recovery in the markets – clear evidence that one should not make emotional or ‘knee jerk’ investment decisions based on short-term ups and downs.

The war in Ukraine has resulted in similar volatility. Once again, you may feel anxious about your retirement savings and where you are invested.

Retirement fund trustees are responsible for ensuring that your investments are expertly handled and closely monitored, to ensure that they remain suitable over the long term. Furthermore, they make sure that your investments are diversified, so that you do not have ‘all your eggs in one basket’, so to speak.

Trying to time the market is ineffective at best, and usually very risky. It’s important that you understand the consequences of switching into and out of your investment portfolios. If you sell at a loss, you’ll be moving less money than you originally had. And when the price of that particular portfolio goes back up and you want to get back into it, you’ll have to pay a higher price to do so.

Finally, if you remove your investment during a down market, you won’t benefit when the market recovers, as we have seen it do in both the recent past and historically.

You are encouraged to speak to your financial advisor before making any investment decisions.