While many investors may have lost their annual gains in equities due to the recent slide, there are others who have built high cash positions, said Kristina Hooper of Alliance Global Investors.
Allianz expects heightened volatility with a downward bias in the coming weeks and investors with a long enough time horizon should hang around because markets are likely to see a turnaround by the end of the year, she noted.
Economist John Maynard Keynes had famously said “in the long-term we are all dead.” Asked if she regrets the advice that people should remain invested when the markets continue to fall, Christina answered in negative. Investors need not worry too much about short-term movements. Investors lose the most money when they are not able to stay invested because they often don’t get back in when the markets begin to recover, she explained.
