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Market Volatility report

Since the turn of the year and after a prolonged period of growth, world stock markets have displayed a marked increase in volatility as investors try to come to terms with a variety of macro-economic and geo-political issues. 

These include rising inflation, higher interest rates, the war in Ukraine and fears of recession.  In the long history of positive stock market returns, bouts of volatility, such as the current one, are not unusual but are obviously uncomfortable and worrying when they occur.

A sense of perspective does however need to be taken, in as much as the long-term attractions of equity markets remain intact and high quality and well managed companies will, as ever, prevail.  The recent sell-off in highly valued US technology and certain pandemic ‘lock-down’ stocks was very much overdue.  Many of these companies are now more realistically priced.  In the short-term, markets also appear oversold.

In accordance with current financial regulations, we are obliged to inform clients if their portfolio falls in value by 10% or more during the three-month period from their last formal valuation date.  With large intra-day percentage market movements increasing, it should come as no surprise that at some stage during the year, even well-balanced portfolios could succumb to temporary falls of this magnitude.

We would urge clients to take the long view and to speak to their Fiske Investment Manager if they have any concerns.

Tony Pattison

10th May 2022

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