Volatility in the Markets

For most equity investors, whether trading as individuals on their own ideas or using the services available from brokers and other institutions, 2015 has been very challenging. It has to be acknowledged that the lack of objectivity sometimes shown by the media in reporting and analysing events can make the investment process unnecessarily stressful.

This has been particularly the case in the past few weeks as Greece has teetered on the edge of Eurozone excommunication and the slowdown in the Chinese economy has been brought into sharper relief by the Central Bank’s snap currency devaluation.

The FTSE 100 Index has fallen almost 7% year-to-date although the rise of 4.8% in the FTSE 250 Index in the past eight months has moderated the decline in the FTSE 350 Index to just under 5%.

Certainly, this has been a testing period too for market professionals such as Beaufort Securities. We keep market trends under constant review and maintain a day-to-day watch on both buy and sell investment opportunities for our clients.

Beaufort’s overall strategic view is made available to all clients through our website in the form of periodic interviews given to Bloomberg TV and other media groups where the interviewers elicit Beaufort’s latest strategy for the markets. The website also provides regular assessments of individual companies monitored by the research team at Beaufort Securities applying fundamental research principles.

In contrast, the conclusions for our Investment Strategy, both top-down and bottom-up, are achieved through applying a combination of both fundamental and technical research techniques. Typically, the evolving technical picture provides pointers for market and stock levels and helps to time investment entry and exit points.

The technical picture is then rationalised in fundamental terms which may be rooted in, amongst other things, economic, geopolitical or specific corporate events. These views are disseminated exclusively to clients through our Advisory Broking Service. It is only through being contacted regularly by our team of Advisory Sales Advisors that clients are kept fully aware of our views on the markets at any particular time.

The style of investment support that clients feel they need is a matter of personal choice. The market conditions we have experienced recently may prompt reflection on the most suitable approach for productive investment.

Mike Franklin Chartered FCSI

Chief Investment Strategist


The information does not constitute advice or a personal recommendation or take into account the particular investment objectives, financial situations or needs of individual clients. You are recommended to seek advice concerning suitability from your investment advisor. Investors should be aware that past performance is not necessarily a guide to the future and that the price of shares, and the income derived from them, may fall as well as rise and the amount realised may be less than the original sum invested. There is an extra risk of losing money when shares are bought in some smaller companies including “penny shares”. There can be a big difference between the buying price and the selling price of these shares and if they have to be sold immediately, you may get back much less than you paid for them or in some circumstances, it may be difficult to sell at any price. It may also be difficult for you to obtain reliable information about the value of this investment or the extent of the risks to which it is exposed. Where a company has chosen to borrow money (gearing) as part of its business strategy its share price may become more volatile and subject to sudden and large falls. This type of investment may not be suitable for all investors, and you should carefully consider your own personal financial circumstances before dealing in the stock market, particularly if on a fixed income or approaching retirement age.

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