Market jitters and money moves: Why investors should manage expectations in uncertain times

Investments are never a certain thing, and the current global economic climate is more uncertain than before.

With valuations skyrocketing, the rand finding strength, and oil prices dropping, the market has left investors in a precarious position, says certified financial planner Paul Roelofse.

Remain cautious and aware of one’s expectations, and not on past performance.

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“We should sober our thoughts, especially as we move into the festive season, and take stock of what might happen next year. There are signals out there right now which deserve our attention and I think it comes down to managing our expectations,” he says. 

He touches on the concept of ‘time in the market’, which suggests that investing over time can lead to better returns.

In uncertain times, it might be wise to hold back and protect one’s capital. 

Consider diversifying without over-exposing to investments that may not deliver. 

He suggests cash, which offers a relatively safe 6% return, can be a viable option for the short term.

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“It is theoretically 3% above inflation. It’s not a long-term strategy, but certainly it’s a short term stragey to see how this uncertainty [in the market] pans out.”

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To listen to Roelofse in conversation with 702’s Thabo Shole Mashao, click the audio player below: