Investment Challenges Today

Investment Challenges Today


The current investment landscape is a truly challenging place. Rising interest rates and inflation as well as continuing economic uncertainty arising from the Russian invasion of Ukraine and the persistent pandemic have given rise to extreme market volatility. The current scenario has been likened to “… a kind of a Rubik’s cube of risk factors”.

Reflecting these new challenges, the International Monetary Fund reduced its forecast for global economic growth this week, expecting it to slow to an estimated 3.6 percent in 2022 and 2023, down from about 6 percent in 2021.

It was a pleasure to be able to discuss some of these issues live on Bangkok LIVE TV at a conference arranged by Renaissance Fund Management on April 18, 2022.

However unsettling is the current market volatility, historically the present situation is not unusual. The essential consideration is to build an appropriately diversified portfolio that matches your time horizon and risk tolerance. Under these conditions it is likely that the recent market drop will be a mere blip in any long-term investing plan.

Several key factors should be considered. It is important to build a diversified portfolio based on your tolerance for risk. This should be rebalanced regularly and it is also important to build in some protection against significant losses.

Above all it is necessary not to try and time the market because you will never get it right. It is very important to stick to a long-term investment strategy. Continuing to invest even when markets dip may be hard on the nerves. It will however be healthier for any portfolio and result in greater accumulated wealth over time.