The barkers crawl out of their holes again

The combination of stock market and military strategists is almost even better. What they don’t know! They know Vladimir Putin’s motives, know exactly how to successfully defend a country and can of course also accurately predict what the consequences will be for the oil price and the stock markets.

The only amusing thing is that until recently, many of these experts would not have found Ukraine on any world map or considered a Russian invasion unlikely. But what do I care what I said yesterday, they will probably think.

Don’t get me wrong: I would also be overwhelmed if I had to give a competent assessment of the confusing situation. But I don’t presume to boast about my knowledge in such an uncertain environment. After all, nobody knows for sure how the situation in Eastern Europe will develop.

I have a somewhat allergic reaction when stock market wisdom such as “buy when the cannons are thundering, sell when the violins are playing” is passed around. Firstly, it’s in bad taste, and secondly, a war is always unpredictable, especially now that unprecedented sanctions are coming into play. So is everything only going to get worse? Or will Putin soon realize his mistake, sell his attack as a success – after all, he can claim to have destroyed the military infrastructure – and withdraw? In the one case, shares will probably continue to suffer; in the other, there will almost certainly be a recovery. But we don’t know, and speculation is pointless.

But we don’t have to. As is so often the case, the best strategy is to stick to the course you have set in a quiet hour. Panic is generally a bad advisor. However, anyone who is seriously worried about their assets and is losing sleep over the higher swings on the stock markets should fundamentally rethink their asset allocation. After years of the stock market boom, some investors may have overestimated their risk capacity and increased the proportion of shares in their portfolio too much. In this case, it may be worth reallocating to more defensive assets such as gold and bonds.

With this in mind, stay the course and don’t let the puffery get you down!

Yours, Mark Stock©

Mark Stock is a member of the Point Capital editorial team. “I am a stock market enthusiast and am passionate about economic history. I have been following the ups and downs of the markets for years and, of course, invest myself – preferably in shares. So my name says it all. Every month, I take up what I consider to be an exciting topic. And since the focus is on the content and not on me personally, I write under a pseudonym.”