Portfolios must be getting decimated.

dunker1

With equities and commodities(except gold) plummeting must be catastrophic consequences for peoples portfolios, pensions etc. Who knows how bad this can become, seems no limit now to the potential drops. Ant that old agage about investing for the long term no longer seems relevant when its entirely feasible markets will stay low for many many years, as you can see when they were already only at 1997 levels now(FTSE). Fair play to anyone who sold out last year and decided to hold cash, my brother went to see a "professional" at Killiks and was advised to invest in funds which have performed horrendously, still they got their commision...lol. I suppose some good will possibly come out of this eventually with a more prudent approach and a general distrust of so called experts.

purch

must be catastrophic consequences for peoples portfolios, pensions etc

Speak for yourself............

dunstonh

With equities and commodities(except gold) plummeting must be catastrophic consequences for peoples portfolios, pensions etc.

Hardly.

The market drop is quite typical for a bear market. The drop so far from high point is much lower than the tech stocks crash. Any sensible investor firstly wont be 100% invested in equities and secondly, they know that you get an event like this typically once every 5 years.

cogito

they know that you get an event like this typically once every 5 years

This has a very different feel from previous 'events like this', don't you think?

dunstonh

cogito wrote: »

This has a very different feel from previous 'events like this', don't you think?

You mean how the last one went down 43.5% and this one has gone down 30%? or perhaps you mean that we now have 24 hour media coverage that no longer reports the news but helps make it and then milks it for everything it can?

Every event there is now is presented as a major problem that could cause the end of civilisation as we know it. It doesnt matter if its economics, society, terrorism or whatever. The Govt seems to want to let us spend our life in perpetual gloom. Its up to you whether you decide to go along with that or not.

Things are not great by any measure but the current events are not comparable to the depression by a long shot. It is the worst banking crisis since the depression but every sector has had a bad period at different times. Most bear markets see a target sector or two suffer more than the others.

cogito

Fair enough but the job of the banks is, amongst other things, to oil the wheels of industry. If they don't do that, and their are indications that they aren't going to be able to, we're in for serious problems.

musehead

I invested into (mostly equity) funds at the end of October last year - the worst possible time really! My portfolio has lost 21% since then, which does not seem too bad considering. I'm gonna rebalance and maybe put more money in at the end of October.

tomstickland

Decimate originally referred to the killing of every tenth person, a punishment used in the Roman army for mutinous legions. Today this meaning is commonly extended to include the killing of any large proportion of a group. Sixty-six percent of the Usage Panel accepts this extension in the sentence The Jewish population of Germany was decimated by the war, even though it is common knowledge that the number of Jews killed was much greater than a tenth of the original population.

OK, 2/3rds of the usage panel agree that decimate can be used to mean a reduction by a large amount.

1echidna

Interesting that the number of people watching this section of the forum the last few days has been very high (around 300). Personally I was very worried about 15 months ago when deciding what to do with a quite substantial sum of money. I did my best and am content now to see how the chips fall over the next year and beyond, possibly putting more cash into property and equities. I am inclined though to believe the pundits who say that there is damage to the foundations of our capitalist system which will have an increasing damaging effect on the wider economy. In short why lose any sleep over something one has no control over but I don't expect any great recovery for at least five and probably ten years.

Milarky

Original meaning of 'decimate': to reduce by one tenth (10%) So, yes, on a bad day portfolios are, literally, 'decimated'

GeorgeHowell

As of this moment the FTSE 100 index is 30% below its all time high, nine years ago. The fall in real terms is obviously considerably more than 30%. Even allowing for dividends there is a fall. This surely destroys the myth that equity based investments are a sure fire hit if you wait long enough. Who knows when even the 1999 level will be reached, let alone a long-term gain. Same applies to real estate as an investment. Financial advisors always point people towards equities, because otherwise their services would not be required, be they independent or tied, commission or flat fee.