I get the idea that it's a questionable pursuit trying to time the market and that markets are a random walk and all that. What I don't get is someone selling a market commentary service restricting such commentary to saying that important current events are unlikely to have significant long-term implications. If this is true and possibly it is, then why the heck do you provide a market commentary service in the first place?
Regarding Russian revolution , yes shareholdings may have been wiped out but so too were property and cash ,
I suppose Gillen Markets can answer for themselves but seems they are saying long term these events don't matter much. Short term they do, so I suppose that's why they comment on the market on their weekly newsletter.
While comparing brexit to the russian revolution is certainly over the top, things indeed do happen.
A well diversified portfolio in St Petersburg, Shanghai, and Berlin were all wiped out in the 20th century.
The idea that a "diversified investment portfolio has always done fine through whatever nastiness the world throws up" is only true if you confine your attention to those parts of the world that have not undergone a seismic shift in the basis of their legal and economic systems.
Brexit by itself is a seminal event to quote S&P, the political turmoil that seems to be engulfing the UK, may pass but it may do considerable damage before it does.
They would not be well diversified portfolios because of their geographical concentration.
A well diversified portfolio has always done fine in the medium to long term.
The effects of Brexit may be felt well beyond Britain. And if Trump is elected the effects will be felt around the world.
So it is a good article?
I am very confused now.
Brendan
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