So, we’re two months in to my long term investment strategy now – and February wasn’t nearly the bumpy ride I was expecting from last month’s review. Trump’s promises of company tax breaks has fuelled optimism, leading to record breaking performance from the Dow Jones Index, which has in turn passed on it’s goodwill to the world’s major indexes.
Strong data at the beginning of February started the month off on a positive note and while there was very little direction in week two, mainly due to a lack of economic or political events, inflation data and some positive earnings reports for some of the world’s blue-chip companies carried momentum in to week three. News of a potential Scottish Referendum hit the Pound which, ultimately, boosted UK Markets while the Dow Jones hit fresh new records on it’s way to an historic run.
Commodities have generally been having a good time of things too. Gold has managed to claw back the losses it sustained in the week’s after Trump’s election. Speculation on my part that investors are excited by Trump’s pledges for businesses – but keeping the safe-haven asset in reserve should it all go wrong.
What did that mean for my portfolio?
Well, in short, the value went up – and pretty significantly too. At the time of writing, the Fidelity Global Technology fund is up over 12% in 2017 – my stand out performer. But there have been other significant moves too – HL Select UK Shares has fared similarly well while Fundsmith is up by more than 8%. The Emerging Markets and Sustainable Funds were each up over 5% too.
The only blot I have on my portfolio at this stage is Gold. Even with the 15 week highs we are seeing, it’s still not quite enough to see me in profit. I did purchase in to a Gold ETF in August last year which coincided with it’s recent highs. As the price fell towards the end of the year, I purchased further increments at the lower prices in order to reduce the average purchase price. A strategy that appears to have helped me to offset its impact on the value of my investments.
What does that mean for overall performance? Well, at the end of February, the value of my investments was up by 5.03%. Those of you that have been following my journey will know that I’m aiming for 15% growth each year in order to achieve my long-term targets. So, on that basis, it’s been a very good start to the year.
However, I think it is important to keep feet firmly planted on the ground – resist the temptation to become complacent. For every bull market, there follows a bear – and with so many potentially significant events coming up in 2017 – I feel there is plenty of reason to remain cautious and alert.
I do hope that my ramblings are inspiring you to take action and set up your own long term investment strategy. With interest rates as low as they are, the potential gains from the financial markets could well surpass any interest you may be getting from your bank account. With inflation rising, your money could well be losing value. Now is the time to take action. Good luck – and let me know how you are getting on!