Proof that market downturns are temporary

Jeff Prestridge, the long-time personal finance editor of the Mail on Sunday, has featured our analysis of the long-term returns offered by equities in this Sunday’s newspaper.  We were happy to engage with him because we think it is an important and powerful message to get out at this time of uncertainty and concern.

Our conviction is to invest in the stocks of companies that have quality and value for the long term.  When uncertainty is high and markets sell-off as they have, it can be challenging to focus on the fundamental strength of companies, their sustainable competitive advantage and their potential for value creation. 

We invest in companies, not markets but it is a fact that equities as an asset class have performed strongly over decades and that they are the most liquid and most accessible way to preserve and increase the real value of assets over the long term through inflation, geopolitical and macroeconomic uncertainty, economic cycles and other issues.

Our analysis of the long-term investment returns offered by equities shows that it is hard to find ten year periods in which investors did not generate returns of 8% per annum or more from investing in major markets.

We had an opportunity to share it with Mr Prestridge and believe his article will help people to understand the importance of investing with a consistent and long-term approach, regardless of whether it is selecting companies as we do, or investing in markets as a whole, with all the benefits and drawbacks that come with investing in index funds or ETFs. You can read the article on the Mail Online website by clicking the link here.


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