When is the best time to invest?

Here are three lessons which might give a different perspective

Everything Changes – Bear markets have always been temporary. And so have bull markets.

Common wisdom suggests that you should buy when stock markets are at their lowest point and sell at their highest.

In reality this is almost impossible to achieve – no one can reliably predict the exact time markets will finish falling or when they will reach their peak. However, history gives us three lessons:




1. Each bear market has been followed by a bull market

Number of Bear Markets*
9 in Developed Markets 10 in Emerging Markets
Number of Bull Markets*
9 in Developed Markets 10 in Emerging Markets


2. Bull markets have lasted more than three times longer than bear markets

Average Duration of Bear Markets

in Developed
Markets

in Emerging
Markets

Average Duration of Bull Markets

in Developed
Markets

in Emerging
Markets



3. Returns in a bull market were substantially more than losses in a bear market

Average Market Decline

in Developed Markets

in Emerging Markets

-30%

-32%

Average Market Increase

91%

338%

in Developed Markets

in Emerging Markets



Developed markets represented by the MSCI World Index. Emerging markets represented by the MSCI Emerging Markets Index. Performance in local currency as at 31/12/2017. Past performance is no guarantee of future performance. An index is unmanaged and one cannot invest directly in an index.

By trying to guess exactly when to invest, you may miss out on some falls, but could also miss some potential rises. Missed opportunities like these can take a bite out of returns.

DON'T MISS OUT ON A MARKET RECOVERY

It can be difficult to take a long-term perspective during volatile markets with daily injections of bad news. If you develop the ability to focus on the long-term, you'll have mastered the primary approach to living with volatility's downside.

By speaking to a financial adviser, you can discuss your investment options and find a solution that's right for you

Franklin Templeton Investments offer a choice of funds that invest across different market sectors, geographical areas and asset classes.

VIEW OUR INVESTMENT STRATEGIES

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