By Shane Oliver, Head of Investment Strategy & Chief Economist from Oliver’s Insights, AMP Capital, Edition 33 2015
Key points
- Periods of declines and volatility in share markets are a normal part of the way they work.
- Share market falls tend to be deepest when associated with recession (particularly US recessions).
- Share market falls boost the medium term return potential from shares and once share markets bottom they are invariably followed by a strong rebound. Trying to time the bottom though is always hard, so averaging in after falls makes sense for those looking to allocate cash to shares.