In the midst of widespread uncertainty, investors are asking key questions. Such questions include:
- Should equities (shares) be abandoned in favour of cash?
- Is a significant hike in offshore exposure advisable?
- Should one be down-weighting one’s risk exposure?
Our view is that investors should be careful of deviating from the strategic allocations that are in alignment with their specific risk profiles. Cycles will always come and go, the rand will fluctuate and asset classes will disappoint over the short term.
With this in mind, changing a portfolio in a meaningful way should only be in response to a change in needs – and not in reaction to market movements or performance.
Without doubt, markets move extremely quickly. The sharp recovery in risk assets in July is an example of how quickly things can turn around!
Arguably, the most important element is getting the right strategic allocations in place – according to one’s risk profile – and then sticking to the long-term plan.
Source: Coronation Fund Managers