There have certainly been variations in volatility under certain premierships, with events such as the 2008 financial crisis punctuating the graph. However, what this graph illustrates is that there is no obvious pattern of long term stock market performance based upon which party has the majority in the Commons at the time. Rather, for those with a long-term investment horizon, it does show that the market has provided substantial returns regardless of the occupant of Number 10.
In general, if you attempt to make investment decisions based upon the outcome of elections or other short-term events, they are unlikely to result in reliable excess returns. At best, any positive outcome based on such a strategy will likely result from random luck. At worst, such a strategy can lead to costly mistakes. Accordingly, there is a strong case for you to rely on patience and well-considered portfolio structuring, rather than trying to predict short-term outcomes to achieve returns or avoid downturns.
A disciplined approach to investing
A disciplined investor looks beyond the concerns of today to the long-term growth potential of markets, and markets have rewarded discipline. With this in mind, we advocate holding globally diverse portfolios to ensure political events in one region do not overly effect the pursuit of long-term investment returns.
Rather than attempting to predict the future or outguess others, Buzzacott’s approach is to draw information about expected returns from the market itself, using data and academic evidence.
The first step towards building a robust financial plan and investment strategy is a free initial meeting to explore your current position and aspirations.
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