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A Long-Term Approach to Equity Investing

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A Long-Term Approach to Equity Investing A long-term approach to equity investing 1 January 1980 – 1 January 2020 US-China 'Phase 1' trade deal agreed 13 December 2019 US imposes 10% Value of tariffs on US$200bn of China imports Japan investment as at 24 September 2018 Lehman Brothers Fukushima 1 January 2020 bankruptcy disaster The case for long-term investing in equities has been 16 September 2008 11 March 2011 reaffirmed by recent market volatility. Equity markets are volatile, but a wide range of crises has Donald Trump elected $ 8 November 2016 US Fed not stopped equities delivering higher average Euro launched launches QE US$509,267 01 January 1999 9/11 attacks on US 16 December ECB commits to 'do returns compared to bonds and cash since 1980. 11 September 2001 2008 whatever it takes' to EQUITIES save euro 26 July 2012 Collapse of LTCM US sub prime crisis China devalues An investment in the MSCI World Equity Index on hedge fund August 2007 renminbi 11 August 2015 1 January 1980, with all dividends reinvested, 23 September 1998 Argentina crisis US$400,000 would have grown to over 50 times its original value 31 December 2001 Russian default by 1 January 2020. 17 August 1998 1st Greek bailout 2 May 2010 Peak of Start of Second dot-com bubble Gulf War 10 March 2000 19 March 2003 Black Wednesday: UK leaves US$300,000 ERM 16 September 1992 Japan Nikkei 225 peaks at 38,916 31 December 1989 Berlin Wall falls US$200,000 09 November 1989 Start of Asian financial crisis 02 July 1997 US$169,515 BONDS Black Monday: Start of First Global stock market crash Gulf War 19 October 1987 02 August 1990 US$10,000 US$100,000 invested on 1 January 1980 US$55,670 CASH Return p.a. 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 Year 27.7 -3.3 11.3 23.3 5.8 41.8 42.8 16.8 24.0 17.2 -16.5 19.0 -4.7 23.1 5.6 21.3 14.0 16.2 24.8 25.3 -12.9 -16.5 -19.5 33.8 15.2 10.0 20.7 9.6 -40.3 30.8 12.3 -5.0 16.5 27.4 5.5 -0.3 8.2 23.1 -8.2 28.4 EQUITIES (%) 1.0 5.6 33.9 3.1 14.2 28.0 20.2 -3.2 6.5 16.4 6.7 17.3 6.4 12.0 -7.9 23.7 0.1 11.2 13.1 -8.3 14.4 3.8 14.5 1.2 4.8 2.2 1.5 9.6 21.2 -9.4 8.6 16.9 4.3 -7.6 10.9 1.0 0.9 2.1 -0.1 9.5 BONDS (%) 12.3 15.3 11.3 9.1 10.2 7.9 6.2 6.0 7.0 8.5 7.9 5.6 3.5 3.1 4.4 5.7 5.2 5.3 5.0 4.8 6.1 3.5 1.6 1.0 1.4 3.2 4.9 4.5 1.4 0.1 0.1 0.1 0.1 0.1 0.0 0.1 0.3 0.9 2.0 2.1 CASH (%) This marketing document is exclusively for use by Professional Clients in Dubai, Isle of Man, Jersey, Guernsey and the UK. This document is not for consumer use, please do not redistribute. Past performance is not a guide to future returns. Source: Datastream. All data are to 1 January 2020. Equities are represented by the MSCI World Equity Index in US$ terms with all dividends reinvested. Bonds are represented by US 10-year Treasury bonds with all income reinvested. Cash is represented by US three-month Treasury bills with all proceeds reinvested. Investment risks An investment cannot be made directly in an index. Unlike money deposited in a bank or building society account, an investment involves stock market risk. This means that the value of investments and any income will fluctuate (this may partly be the result of exchange rate fluctuations) and investors may not get back the full amount invested. Past performance is not a guide to future returns. Important information This marketing document is exclusively for use by Professional Clients in Dubai, Isle of Man, Jersey, Guernsey and the UK. This document is not for consumer use, please do not redistribute. Where individuals or the business have expressed opinions, they are based on current market conditions, they may differ from those of other investment professionals and are subject to change without notice. This document is marketing material and is not intended as a recommendation to invest in any particular asset class, security or strategy. Regulatory requirements that require impartiality of investment/investment strategy recommendations are therefore not applicable nor are any prohibitions to trade before publication. The information provided is for illustrative purposes only, it should not be relied upon as recommendations to buy or sell securities. As with all investments there are associated risks. Please obtain and review all relevant materials carefully before investing. This document is issued in Dubai by Invesco Asset Management Limited which is regulated by the Dubai Financial Services Authority. Invesco Asset Management Limited, PO Box 506599, DIFC Precinct Building No 4, Level 3, Office 305, Dubai, United Arab Emirates. This document is issued in the Isle of Man by Invesco Global Asset Management Limited George’s Quay House, 43 Townsend Street, Dublin 2, Ireland, which is regulated in Ireland by the Central Bank of Ireland. This document is issued in Jersey and Guernsey by Invesco International Limited 2nd Floor, Orviss House, 17a Queen Street, St Helier, Jersey, JE2 4WD. Regulated by the Jersey Financial Services Commission. This document is issued in the UK by Invesco Asset Management Limited, Perpetual Park, Perpetual Park Drive, Henley-on-Thames, Oxfordshire RG9 1HH, UK. Authorised and regulated by the Financial Conduct Authority..
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