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Investment Decision amid Uncertainty （other releases)

Equities outperform bonds in the long run. Despite the market downturn, a good equity investor can maintain their faith in their investing strategies. The drops are in short term while the increase is inevitable. In fact, a permanent loss is a result of the loss of faith, fear, and panic selling. Warren Buffett also experienced a significant loss in 1987, but he did not sell off his holdings.

On the other hand, the reason why equities can deliver better returns than bonds is that they come with greater volatility which in turn brings about better returns. Otherwise, the premium of equities would be gone.

From a personal finance perspective, investors are strongly advised to align the portfolio to their life goals. It is unwise to construct a portfolio based on market outlook. There is no need to change the portfolio if the life goals remain unchanged. In contrast, changing portfolio is due to market conditions is pure speculation and against your life goals.