Buying into the journey

Some of you may be aware that I am a supporter of Liverpool Football Club 😉. At the time of writing (Thursday morning), they are second in the league on goal difference to Arsenal after dropping two points away to mid table strugglers Manchester United last weekend. Manchester City are just one point behind. They have seven matches left and they will probably have to win all remaining seven matches and either hope Arsenal drop points or outscore them by 9 goals in the run in to win the title.

Each remaining match brings its own tensions, and the margins for error are razor thin especially with Arsenal and Manchester City in such good form. But with that tension brings its rewards; the chance to be competing to win English footballs biggest prize, the Premier League title. It is the price of competing at the top.

Buying into the journey

When we invest our money in equities, we are going on a journey too. At the moment, we are enjoying the thrill of the ride. The MSCI World Index is up 9.97% so far this year and up 19.54% in the last year. But there will be times of disappointment too when the stock market doesn’t do well. 2022 saw the same index lose -12.85%, which is nothing compared to the -37.73% it lost in 2008. Or the -30.67% it lost in just one month when Covid 19 shut down the global economy and no one knew how long the world would be closed for! But despite that massive crash, the MSCI World index was up 6.25% for the year. The annualised return over the last 10 years is 10.55%. That means if you invested €100,000 ten years ago, you’d have €272,638 today excluding taxes and fees.

If you want to enjoy the positive returns of the stock market, you have to suffer the pain of the falls as well as the joy of the gains. It’s part of the journey of being an investor.


Steven Barrett

15 April 2024