Geopolitical risks involving military conflict

I came across some interesting data which shows the markets response to geopolitical risks involving military conflict. Please see below table.
Of note, history shows that these types of conflicts rarely trigger a market crash. From a portfolio perspective, I think you will find investors, right now, are more worried about inflation risk, increasing interest rates and how the property market will perform over the next 2 years.
Geopolitical risks (involving military operations) are always a concern, but the impact on your super and the influence this has on our investment choices are less significant than other concerns.
During times like this you can experience hesitation before a significant investment decision. If this is the case, please contact us to discuss your options.

At this point the key takeaways are:

  1. our thoughts and prayers go out to the people caught up in the conflict
  2. historically, geopolitical tensions rarely have a lasting impact on markets, since they rarely have a lasting impact on the business cycle
  3. rates are likely to rise due to inflation pressures that would exist regardless of the conflict
  4. at the moment, the negative sentiment since the beginning of the year is more an opportunity than it is a risk

As a result of this conflictwe are very watchful to the prevailing news and conditions. Strategies such as rebalancing of portfolios and gradual investing, can be employed to help reduce the risk of ill-timed investments.

Source Yahoo Finance.
James Mottram
Director Financial Planning
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