How should we approach investing in 2015?
First, we should look beyond 2015. 2015 will only see the groundwork being laid for future growth. Our confidence in the return of growth in the economy will grow in 2015. But, the speed of change will not meet market expectations. So the first thing we should learn from 2014 is to expect less in 2015.
A sobering of expectations will help us be less anxious. After all, the markets are only going to get better over a three year time frame. By being less anxious, we are able to focus beyond the immediate. When we stop worrying about the immediate, we start investing with a much longer investment horizon. The markets may lose their patience and the present excitement may dip. That is when our investing must gain momentum. We must play contrarian. Buy when others sell. The only thing an investor must keep on top of his mind is that this year will be a test of patience. If we master the art of being patient, we will be able to make several investments in 2015 that will deliver big in the future years. Avoid impatience.
Remember, 2015 will be a year of consolidation. The good news on the growth front may well get delayed towards the end of 2015. But, that delay is good news for those who aspire to invest more in equity 2015 will be a second opportunity to raise our equity exposure. What should we do with our existing equity investments? Let your profits run. Don’t cut profits early in a prolonged bull run.
The long and short –
Believe in equity.
Pace your investments right.
Bet on the return of growth.
Ensure adequate equity exposure.
Invest time in the market.
Stay focussed on your end goals.
A fantastic opportunity to invest in equity awaits in 2015. Sit tight and enjoy the ride.