Distorted Expectations

May 28, 2020
by Rob Zdravevski

It seems that stockmarket investors are Short patience & Long complacency.

To boot, many now expect daily returns of 2% or more;

which is perfectly fine is you’re a beneficiary, however, in an environment of 1% cash rates, it’s with a gentle reminder that should your equity portfolio investing produce a return of 6%-8% per annum above the cash rate, then you are generally doing quite well….especially if you’re being honest about the risk you are taking to achieve this.

As an investment advisor, it’s concerning to me that some consider it all wrack and ruin if they can’t “crank” out 6% in one week.

That’s why this current equities rally is really messing with people. It may do a real number on the newcomers.

The continual conundrum in capital markets is….that often markets move to where they can do the most damage, and for the past 2 months that direction has been “up”.

What’s next?