In the past three years the New Zealand Stock Exchange (NZX) as a whole, has increased by a whopping 77% in capital terms (tax free). On top of this, investors have received cash flow by way of dividends, making investing in our local markets very profitable.
History has shown that markets that go up, can just as easily go down, and now is a time for caution by investors. I am not a fortune teller so I can only look at the market indicators and make a judgement call.
The dramatic fall in dairy revenues, the fall in business confidence, the projected fall in inflation and our very strong currency does not bode well for our economy and therefore the NZX. The New Zealand dollar is up around 18% from where it was three years ago, and while our Reserve Bank continues to talk about increasing interest rates in late 2015, our exporters will be in for some tough times.
The tough thing for investors is to find a reasonable alternative in which to invest. Personalised advice will always be the best advice – advice that’s a match to your individual circumstances. For example for some investors, this will be to sell out and bank the profits; others however, will do well to broaden their investments.
My job is to help you build a successful investment portfolio. I know where to look for investments that work just for you and your circumstances. Experience counts in the investment game. Call me to discuss your personal investment requirements today.
John Barber