Past performance – health warning required!
Most people have a “herd mentality” to their investing. Are you part of the “herd?” It is usual for people to choose the “flavour of the month” when it comes to choosing their investments. They will pour money in to ONE popular asset class within a popular fund. They fill their pension or investment portfolio with narrow focused funds, only to find that overtime, their performance is poor.
Investing is more about looking forward than backwards. Past performance can help but must not be relied upon. There are many stories of investor chasing a particular asset class and fund because of its past performance, just at the time, when the investment sentiment has ran its course and the past returns are unlikely to continue. Remember the dot com bubble or the commercial property bubble to name just a couple?
Don’t get caught by the “herd mentality”, you need to ensure you have a broad spread of investmnets and not just chase the current “flavour of the month” in investment circles.
Please contact us if you require help and advice on investing within portfolios or pensions. It will save you becoming one of the herd! Contact Thompson Financial Consulting for help and advice.
The value of investments and the income from them can go down as well as up and an investor may not get back the amount invested. Past performance is not a guide to future performance.