Returns in a falling market




If you feel a little shell shocked after 2008, you can be assured that you are not the only one. Investors and professionals the world over have mourned large portfolio losses in 2008.

Whether you invested in Aussie equities, international equities or property, it is likely that you have seen your investments fall in value.

Rubbing salt in to the wound was the financial instability of the banking system which held our deposits. Governments around the world acted quickly by guaranteeing deposits and dropping interest rates to stimulate the global economy.

If you feel as though there is nowhere to hide from the carnage, let alone profit from it, you would be wrong. This issue focuses on two sectors typically considered portfolio diversifiers that have lived up to their mantra and produced returns during a challenging 2008.

Beauty is in the eye of the beholder

My prediction for 2009 is for indexing strategies to underperform specialist stock pickers.

The seemingly indiscriminate sell-off in investment markets offers investors a fantastic opportunity over the mid to long term to profit from oversold positions of quality companies with strong cashflows.

Investor Insight

Portfolio Construction Forum Take Out