Investment Strategy

Market Drawdowns

By Simon Steele
Head of Global Equities London, United Kingdom

Overview

As the profit cycle matures, we are increasingly being asked how long-term investors should best position themselves should the economic backdrop and equity markets become more challenging.

Key points

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Markets mark-to-market in the short term and are inefficient in the long run.

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The impact from the compounding of cash flows outweighs the potential impact from valuations.

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Consistent and stable cashflow growth is an important cushion to protect and preserve value through a downturn.

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  • Equities
  • Investment Strategy
  • Opinion
  • Other Publications

Important notes

This article has been prepared to provide general information and does not constitute 'financial advice' for the purposes of the Financial Advisors Act 2008 (Act). An individual investor should, before making any investment decisions, consider the information available in the relevant Product Disclosure Statement and seek professional advice. While every care has been taken in the preparation of this document, AMP Capital Investors (New Zealand) Limited and the AMP Group (together, 'AMP') make no guarantee that the information supplied is accurate, complete or timely and do not make any warranties or representations in respect of results gained from its use. The information is not intended to infer that current or past returns are indicative of future returns. The views expressed are those of the author and do not necessarily reflect those of AMP. These views are subject to change depending on market conditions and other factors.

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