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  • Writer's pictureMark Watson-Mitchell

Don't take fright - just sit tight

Investors always seem to overplay their hands.

Russia's massive attack on Ukraine has been a 'real shaker' even though the situation has been brewing for months and months now.

I know this is somewhat of a political comment but my goodness me why did the West just sit on its hands and do nothing?

Well apparently nothing, if they were doing anything I am sure that news would have filtered out from behind the 'closed doors' of government.

So perhaps the numerous deaths on both sides can be blamed upon both Russia and the West, but the latter in minimal claim.

Understandably the markets have been shaken, gold has risen in price, while globally there has been a cry to 'sell Russia'. While oil and gas prices have risen close to new record Highs.

The way that major companies have just jettisoned their interests in Russia has been of massive impact - especially for the mega-companies in the oil sector.

Oligarchs, well just a few, have seen sanctions placed upon them and their investments. Yachts and football clubs are being questioned and seized.

In the meantime the equity market in the UK has slipped away convincingly from its 7687.30 High in the second week of February, to just 6987.14 by last Friday night.

Those indices just reflect the share prices of the top 100 companies. Values for smaller quoted companies have slipped away in relatively light trading.

Several hundreds, perhaps thousands, of investors must have looked at their portfolios and gasped as holdings eased in price by 10%-15%, some even more.

But my thoughts are that investors should back away from studying every minute price movement. Instead they should not take fright but instead just sit tight.

Markets always bounce - some times quickly, other times in slower gradual motion.

Remember that when the Second World War broke out the famous US investor Sir John Templeton piled into the market and invested money into every US share priced at under a dollar. That was how he made his fortune.

'Buy when there is blood on the streets' a useful contrarian principle that has made many a billionaire.


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