There are disturbing times for many investors. It so happened in London that FTSE 100 index reached an all-time high of 7,104 and in the turmoil market of mid-January. It went as low as 5,640 which was a fall over 20%. Many investors clearly got worried and despite of the market’s recovery it still fell further. If you have put your pension in funds and trackers, and you’re planning to retire soon and buy an annuity, then the fall of 20% is real. All things being equal, you’ll buy 20% less annuity income than you got last April. Most of the investors don’t have to face the prospect of selling up so the temporary falls which are of an unknown duration are just like simple business.
Markets can go up and they may come down. The present market conditions give a lot of important lessons for investors. But, we do not follow any advice or lessons given by the well known investors and when our money is at stake, we follow our instincts rather than a well-given advice. Instincts can also lead to wealth destruction rather than wealth-building.
Here are 3 investment basics which can help you face a turbulent market.