News this past week
- Rating agencies cut UK credit rating
- Global equity markets rebound
- European bank stock fragility continues
- Commodities record broad gains
- Mixed results in China’s monthly PMI data
James Klempster, CFA of Momentum Global Investment Management shares his view:
While in the midst of UEFA Euro 2016, it is a good opportunity to unpack the England football team’s abject failure and to look for any positive investment lessons that can be drawn from the debacle.
Have a good strategy and execute. This is key. The England team looked bereft of true leadership and had no definitive strategy, formation, or game plan. It is important to be flexible when the environment necessitates it, but it must only be a means to improve the chances of achieving the desired outcome. A lack of clarity, and change for the sake of it, does not help a team (or a portfolio) gel. What is more, for investors, changes are not costless and so having a strategy in place that will generate the desired returns through a broad mix of market conditions reduces the need to chop and change a portfolio. Knowing what outcome you want to achieve at the outset helps in this regard.