Best investment lessons from 2016

World and financial markets were sent spinning several times over while commentators went into meltdown in 2016.

2016 was the year of the unpredictable events. The world and financial markets were sent spinning several times over while commentators went into meltdown.

Who would have believed a year ago that​ Britain would leave the European Union, that Donald Trump will be next president of the United States​, and that both events would send global markets significantly higher!

There were many lessons to be learned from last year and we recently asked our clients to tell us the best investment lesson they’ve received in 2016. Here are some of their top learnings.

Ignore the market and stay invested

  • 2016 confirmed that the world is unpredictable and that markets sometimes react in unpredictable ways. Regular investments are not only smart, they also reduce anxiety.

  • Sometimes, the best strategy is simply to hold your ground and stay put. Investors who remain calm when others panic, will benefit in the long-run.

  • Who knew the best investment lesson of 2016, if not of all time would come from mum. “Patience is a virtue”, so much wisdom, so simple and so true.

  • Stay invested, diversify and hit the beach! Don’t invest in opinions and predictions. They continue to fail: think Brexit, Trump and Leicester City!

Investing early makes a difference

  • Make a start, no matter how small, it will make a difference.

  • Compound interest is the eighth wonder of the world. He who understands it, earns it … he who doesn’t … pays it.

Invest in yourself

  • The best investment you can make is in yourself. Invest in experiences to develop your own abilities and knowledge.

Be careful who you listen to

  • Thousands of experts think they know what share markets will do. Trump’s election showed they don’t have a clue. Best to just enjoy the ride.

  • Never take financial advice from the Motley fool…

2016 also highlighted how investing in a broad mix of assets can help smooth out the dramatic ups-and-downs of the market that happened last year. As mentioned in our end-of-year update, all of the Stockspot portfolios comfortably withstood the market jitters with Brexit and the US election.

Thanks to the many Stockspot clients who shared their learning with us.

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