Speaker 1: You're listening to a Sheerseise podcast. I've been really hardened
Speaker 1: to see the response to this period of volatility, where
Speaker 1: the latest figures from the Cheess's Index over the quarter
Speaker 1: January to March showed again continuing strong netbuying through this period,
Speaker 1: and then also a shift away from sort of more
Speaker 1: individual companies and into more ETFs and diversified funds as
Speaker 1: well as into defensive individual companies as well. And I
Speaker 1: do think that reflects the fact that we are probably
Speaker 1: in for a period of continued volatility, and diversification is
Speaker 1: a really sort of important thing to make your portfolio
Speaker 1: more resilient to sort of withstand with send that period.
Speaker 1: I also think actually even before this tariff war and
Speaker 1: these geopolitical events that we're seeing play out, you know,
Speaker 1: if I look at twenty twenty four, in the year,
Speaker 1: the S and P five hundred was up, I think
Speaker 1: about twenty five percent, but about half of those companies
Speaker 1: had losses so had a negative return for that period.
Speaker 1: And actually it's a very few number of companies that
Speaker 1: accounted for the majority of that return. And I think
Speaker 1: that is a trend that we're seeing more and more,
Speaker 1: particularly as you have large tech players with high operating leverage,
Speaker 1: and you're seeing some more global companies and unless you
Speaker 1: can you know, really pick who those winners will be,
Speaker 1: it's got to be hard to even beat the market
Speaker 1: return if you haven't got decent exposure to those very
Speaker 1: few sort of fewer and fewer stocks that are driving
Speaker 1: the big outcomes. And so I do think that moving
Speaker 1: more to that diversified approach is really helpful as we're
Speaker 1: seeing that trend even beyond you know, the volatility we're
Speaker 1: seeing off the back of the Trump saga.
Speaker 2: It's hard to look at say like QQQ, the Nasdaq
Speaker 2: ET or the S and P five hundred and really
Speaker 2: consider either of those to be diversified, given the concentration
Speaker 2: of Magnificent seven and you know, just thinking about like
Speaker 2: you know, people on shares this platform, this is key
Speaker 2: we investors being drawn more to US stocks and they're
Speaker 2: going down this. You get told to diversify your portfolio.
Speaker 2: This American market should be one that you should go into.
Speaker 2: But if you're only going into seven companies that are
Speaker 2: making up the dominance of it, it's hard to wrap
Speaker 2: your head around how you're actually diversifying your investment there,
Speaker 2: or if you're just trying to ride the wave that
Speaker 2: we've all been doing for what last seven eight nine
Speaker 2: years now.
Speaker 1: I remember a time on the ins oft X fifty
Speaker 1: where I think it was fishing, Facal, Healthcare, and A
Speaker 1: two milk collectively we're something like thirty percent of the index,
Speaker 1: and so unless you had for fund managers that didn't
Speaker 1: have a massive exposure to those two, they almost always
Speaker 1: underperformed index at that time. What we are also seeing
Speaker 1: because we call a lot of our KEYSAB members and
Speaker 1: we are are tornture investors all the time. And another
Speaker 1: thing we're seeing is we're actually finalarging investors, not disengaged.
Speaker 1: They're not going I just put my head on the
Speaker 1: set end and try and just forget about this period.
Speaker 1: We are seeing investors actually continue to check in with
Speaker 1: their balances, but also they're saying, actually, this is just
Speaker 1: part and parcel of being an investor. And I think
Speaker 1: that really is a shift in mentality of what we've
Speaker 1: seen in previous periods, particularly amongst retail I'm talking to investors,
Speaker 1: I've seen a really big shift in psychology where where
Speaker 1: it is much more volatility is the price of investing,
Speaker 1: and it's not a penalty. It's not for doing something wrong,
Speaker 1: it's literally the price of being in the market. And actually,
Speaker 1: when I do talk to investors, the things that they're
Speaker 1: worried about is not volatility in the short term and
Speaker 1: they shouldn't be like for investors taking a long enough
Speaker 1: time horizon and advertiate. Volatility in in itself shouldn't be
Speaker 1: the issue. The issue is, you know, can I lose
Speaker 1: some all of my money or am I going to
Speaker 1: get inadequate returns for the risk I'm taking on. Those
Speaker 1: are the issues that investors need to be concerned with,
Speaker 1: not that short term volatility. Investing involves the risk you
Speaker 1: might lose the money you start with. We recommend talking
Speaker 1: to a licensed financial advisor. We also recommend breading products
Speaker 1: displosure documents before deciding to invest.