http://www.sensibleinvesting.tv Part 7 of an eight-part series on the lessons to learn from stock market history explains why, despite the constant temptation to trade, the best thing that investors can do once they've built a portfolio that matches their attitude to risk is... nothing. Actually, that's not strictly true, because it is wise to rebalance your portfolio either once or twice a year. Presented by Robin Powell. Expert analysis from Weston Wellington, Charles Ellis, Gus Sauter, William Bernstein, Tim Hale and Richard Wood. Our sixth and final key lesson from stock market history sounds very easy. But in practice it's anything but. Because, once we've decided on a portfolio that accurately reflects our attitude to risk, history teaches us that the best thing is to do nothing. The problem is that we tend to act on our emotions, and men in particular assume that doing something is better than doing nothing. But, looking back through history, investors have all too often done just the wrong thing at just the wrong time. Another problem with trading too often is that it adds to our charges. Over time, those charges can make a massive dent in our investments. When we say do nothing, that actually isn't strictly accurate. Because, perhaps once or at most twice a year, you do need to rebalance. For example, if equities have had a particularly good run, that may have left you with a higher percentage of your portfolio in shares than you're willing to risk. If bonds have done well, your portfolio might be more defensive than you'd like it to be. So, there you have it... the sixth and arguably the most important lesson our experts say investors ought to learn from market history. Join us in Part 8 for a summary of what we've learned - and a light-hearted look at some of the daftest decisions investors have made over the centuries. http://www.sensibleinvesting.tv
Visibility: 6442
Duration: 5m 5s
Rating: 26