Shane Oliver discusses the recent fall in share market prices and compares this to similar falls seen in the past. He also provides insights as to what the outcome might be due to this fall.
The key points are as follows:
• Periods of declines and volatility in share markets are a normal part of the way they work.
• Share market falls tend to be deepest when associated with recession (particularly US recessions).
• Share market falls boost the medium term return potential from shares and once share markets bottom they are invariably followed by a strong rebound. Trying to time the bottom though is always hard, so averaging in after falls makes sense.
To view the full article click here: Share market falls in context – OI #33 2015