What Is The Key Driver Of Long Term Stock Market Returns

Providend

The market has fallen for the first time in 2019!

But fret not. This video was recorded only yesterday and by today, the market has gone up again- further proving the point that it is almost impossible to predict where the market is heading next.

Watch this short video as Christopher Tan, CEO of Providend, explains why you should not let short-term noise distract you from your long-term investment journey.


Hello everybody, thank you for watching this video clip.

Through this way, we hope that we’ll be able to share some of our thinking that hopefully will leave you with some food for thought and make a small impact on your financial and non-financial life.

Today I want to talk about investments.

And it’s interesting because just today the market has fallen. And it has probably fallen the first time since the beginning of 2019. And it’s even more interesting because this morning as I read the papers, somebody was just predicting that the markets, they’re going to go up. The STI is going to go up to even 5000 points.

But the market, they’ve fallen. And the key reason behind why the markets have fallen is because the investors are worried that the trade talks between China and US are not going to happen, it’s going to fall apart.

And this is not new.

Last year, last quarter of 2018, the same thing happened and investors were scared. And if I take us back a few years, we talk about Brexit, we talk about US elections. People were afraid that markets, they are going to crash because the market has been going to for a long time. And if you have done that, if you have stayed away from the equities market, you would have missed the returns over the past few years

And so, what am I saying?

I’m saying please do not be worried by all these noises. Please do not be worried about all this news.

The one thing that drives stock market returns, long term stock market returns, would be earnings. And what drives earnings? Demand drives earnings. And what drives demand? Population growth. And we know that the population, the world population, is growing.

And so if you remember this key driver, just remember anything in between fluctuations, they are all noise.

So stay focused, stay invested for the long term. Do not worry.

And if you find that you are worried, you do not know how to start, feel free to give us a call. Speak to our team of very experienced Client Advisers. And they will be able to guide you, coach you educate you to start your investment journey.

For more related resources, check out:
1. How Should Investors Respond to Trade Wars?
2. How To Be A Successful Investor And Not A Gambler
3. How The Rate Of Return Is Driven By Your Goals | Investment Series


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