Investors should take care not to overreact to the latest movements in global markets. Invest sensibly, diversify and hold for the long term, is
a sound approach. But it is also advisable for investors with either new money to put into the market, or with portfolios that have not been reviewed for a while, to stand back and consider their approach from time to time.
When people review their investments, it is human nature to focus heavily on past performance and invest in the things that have already done well. Over the last decade many investors will have enjoyed supersonic gains from the likes of US technology stocks, global funds loaded up with hefty exposure to US shares and even plain old S&P 500 trackers. Unsurprisingly, investors have continued to throw ever more cash into these parts of the market, even while valuations have steadily become very expensive.
Alongside major changes in the way we shop, work, and entertain ourselves that have driven the growth of blockbuster US growth companies such as Apple, Amazon, Alphabet, Meta, and Microsoft, they have…