Last weeks investment comment from RBS ‘sell everything’, is the laziest piece of investment research I can recall.
They also made great mention of selling commodities. What foresight after most commodity stocks have already fallen 75%-80% in the last two years.
Not to mention who exactly is that advice suitable for? Certainly not if you need any income as cash is not paying interest at the moment.
RBS advice would mean everyone who needed to spend any of their cash eating into their capital.
The market of course has short term fluctuations but if you are invested correctly, with the correct asset allocation, then these should not matter enormously to you.
As for Oil & commodities, they have fallen a very long way already. For our clients that have the capacity and for who it is suitable, I will be looking for the quality companies that will survive this rout and look for opportunities to buy. Clearly some miners have a lot of debt and may be forced into rights issues but for the strong firms who will come out fighting, there will be opportunity.
I note Jim O’Neills comments in yesterday’s Sunday times to not panic over China and pointing out that China is adjusting to market economics. I agree entirely. Business and markets generally should take that approach when dealing/considering China. In terms of underlying investments we are under weight Chinese stocks and will remain so. China is a one party state. Can company accounts be trusted? We have enough problems in the west relying on our auditors.
Chinese financial markets do not operate as free markets yet and as far as I am concerned this reduces their suitability for UK private clients. Not to mention currency swings, lack of liquidity and the odd chairman or two going missing.
As ever though it does not pay to get overly bearish and there will be good opportunities ahead.