Iran Attacks and More
18 April 2024
To all Financial Friends
Much to read and lots to learn along the way if you want to. Otherwise, use the link to book a time for us to talk on zoom for 15 minutes - sorted! Book a time here www.calendly.com/yourfinancialfriend Unusual amount to communicate so do not hesitate - it's good to talk.
In a crazy mixed up worrying world, so good to see that Spring has arrived! In the sunshine through my window I can see our happiest students are those invested in Gold & Silver, Natural Resources and Technology. The last three months show Gold & Silver adding 23.03% followed by Natural Resources +11.89% with Technology funds showing +10.43%. Other holdings show respectable returns of between of 7% to 3% over the same three month period.
Even Index Linked Gilts put on 3.36% taking their slow time to come back from disastrous collapse in recent times. The text book tells us that such gilt holdings are just about the safest investment the world has known. Real life experience has shown investors not to trust the text book I suspect! The Fixed Interest Market (lending your funds to governments and the corporate business markets ) has lost out to investors pouring money into equities. The Dow Jones and S & P indices have been hitting close to all time highs and our FTSE 100 Index went above the 8000 point mark, close to all time high level.
All time high levels! Why? More than two wars, inflation as yet undefeated for sure, global warming, economies on the brink of recession and much more. Human nature and behaviour sadly rebounds to greed and fear we might suspect. The Federal Reserve in the USA had hinted at a likely three drops in interest rates in the current year - then they wobbled on the idea - then there was an uptick in inflation and expectations of the risk of rates going higher raised the risk of holding equities.
So what happened? On falling interest rate news, equities rocketed upwards. When the good news failed in expectation, investors feared a recession looming. Equities were sold and the money poured into gold - causing that 23% gain in gold in over just the last three months.
Iran Attack
The direct attack by Iran on Israel threatens the risk of all out war across the middle east with the risk of major powers being dragged in. We hold our breath to see what Israel's response will be. Money Market funds are a relatively safe haven in these times. Managers of these funds invest in short dated securities with government backed loans. Some such of these funds have made returns of 4% to 5% over the last 12 months with next to no risk. If you want to protect your funds in this way book a time to get the help you need here www.calendly.com/yourfinancialfriend
Money Market funds are only a temporary home for your money while markets settle and you move back into different assets for the future. Of course if equities ignore the current risk and rise, you will miss out on the gain, but you should have protected your capital if things worsen.
Strategies
Amongst students, the Accumulator and Profit Taking Strategies are the most popular currently. Both strategies carry defensive opportunities yet offer realistic opportunities for profit. For those considering a likelihood of a market correction downwards, or something worse, these two strategies are appealing and both provide the chance to win whatever happens. I attach the five strategies for your reference if you wish.
Talk with Rob? www.calendly.com/yourfinancialfriend
PLEASE NOTE: A financial or economic commentary like these, are written to explain, interpret or give an opinion on economic events and markets to help readers understand what’s happening and why it matters. Designed to help you make informed decisions of your own by making you aware of opportunities, risks and potential rewards in the market.
