For some people, waking up to the large Tory majority last Friday will be a relief, avoiding higher taxes and a deeply socialist agenda. However, others and particularly in Scotland and London perhaps, will feel bitterly disappointed that the seemingly last chance to avoid leaving the EU has probably gone.
Whatever your political persuasion, we are where we are. The political gridlock has been unblocked. Many will simply feel relief that the endless squabbling and stalemate in Westminster is over.
Politics is increasingly an unpleasant spectacle. Yet democracy, for all its critics, has again delivered something positive. We have seen a greater engagement in the tough issues we face as a nation, the freedom to go to the ballot box and cast our vote for any candidate that we wish and a high turnout of those wishing to voice their opinion. We have each made our own individual contribution to the type of country we want to live in. That is a privilege easily overlooked or taken for granted.
The future, as ever, is uncertain with heightened geopolitical tensions, Trump’s pending impeachment and the ongoing US trade war with China. Here at home, the challenges of an ageing population, the NHS and social care, negotiating a trade deal with the EU in 2020 and the risks of a potential breakup of the Union are material. Yet these are things largely beyond our control.
What we can control though is how our investment portfolios are structured to deal with whatever is thrown at them by the markets, in response to these ‘known unknowns’ and also any ‘unknown unknowns’ as Donald Rumsfeld, the US Secretary for Defence famously stated.
Remember, investing well is simple, but not easy and the core pillars that Wells Gibson advocates are:
- markets work pretty well and are hard to beat, so capturing the market return on offer, using lower-cost, well-structured products makes good sense;
- spreading equity exposure broadly across markets, sectors and companies to ensure the risks we face are well-diversified will always sit at the core of a successful long-term strategy;
- balancing out the risks of equities / shares by owning high quality bonds provides a good insurance policy against tough times in the equity markets; and
- being patient (living through the short-term falls) and being disciplined (maintaining your philosophy and strategy over time) are fundamental to achieving the returns you need to fulfil your lifestyle and financial goals.
Whatever happens in 2020 and beyond, try not to worry too much about markets and the uncertainty in the World. You can’t control how the markets behave but rest assured that if your investment portfolio adopts the above core pillars, it will be as strong as it can be to deal with whatever the markets throw at it.
Try to forget about politics, the markets and your portfolio and let’s enjoy a relaxing Christmas with loved ones and be grateful that we live in a peaceful and free democracy. Many in our World are not so fortunate.