Later this month, the people of South Africa head to the voting booths, and we shouldn’t be surprised by mounting tension and unease as sensational headlines dominate the news, sparking increased uncertainty and a risk-off sentiment when it comes to our money.
With more than half the world’s population heading to the polls this year, it’s important to remember that 2024 is the year to follow the trend lines and not the headlines. Political dynamics are set to influence market sentiment and investment strategies. The current challenge facing many long-term investors is to survive the shorter-term market disappointments in order to benefit from the return premium offered by growth assets over the longer term. In today’s uncertain investment environment, asset allocation and stock selection are paramount, and keeping a global perspective is crucial when considering your financial goals.
In light of these developments, we aim to provide valuable insights and analysis to navigate the intricate intersection of markets and politics. The attached article from Morningstar highlights the fact that markets and politics do not take place in a vacuum; everything is interconnected and there is always a myriad of forces at play. Emotions intertwined with political beliefs present behavioural challenges, undermining the type of rational, coolheaded decision-making that investing demands. It’s wise to acknowledge that elections will most likely increase short-term volatility, but it should not affect your long-term investment strategy or financial plan.
