Page 28 - Phonebox Magazine February 2008

Finance Matters
brought to you by Advison Independent Financial Advisers
Is now the time to invest?
2008 brings heavy falls in the stockmarket
The first few weeks of the new year have seen turbulent times for shares both in Europe and America. This is on the back of increasing concern that the American economy is going to experience a recession, rather than a slowdown.
At the start of 2008 the FTSE 100 stood at 6,456 but as this is written, the value has fallen by 13% to 5,585. By most methods of valuing shares the falls look to be an overreaction and certainly when you compare the level of dividends to the actual price of shares, they look very attractive. Of course, the concerns that are hitting the stockmarket are that those dividend levels will fall in the next year and that is why share values have fallen.
Nobody ever knows exactly what effect a recession will have on the earnings of individual companies and as such the price of shares are held hostage to the views of the market makers at the stock exchanges around the world. Of course, they can, and do, get this wrong by both over estimating and under estimating the true effect of an event on the economy. Over the medium to long term the price of a share will tend towards its realistic value but in the shorter term its price can bear little relation to its true value. A
classic example of this was seen a few years ago when Marks and Spencer’s shares were at a level which gave the company a value that did not even match the value of the properties that they owned.
Those taking a longer term view when investing, will usually see a fall of this magnitude as an opportunity to buy. However, for many the fear of the market falling further will stop them investing, preferring to wait a while until the markets have settled down. Unfortunately, when most investors refer to the market settling down they actually mean they are waiting for it to go up again and as a consequence end up buying at a higher price.
At this time of year many people are looking to use their ISA allowance and will have been prepared to invest in March, expecting the market to still be around 6,250 – 6,500, as it had been for some while. For those individuals, the opportunity to buy in with the market around 10% lower, will be welcome news.
Advison has a wealth of experience in helping clients with different investment strategies and tax planning, ensuring that a well constructed portfolio provides the diversity required. We are also able to review your investments so that they remain in line with your personal circumstances and objectives. K
Unlike many IFAs, Advison not only provides the initial advice you require but also produces regular personalised reviews of your Investments, Pensions and Protection Policies, enabling us to ensure the assets you hold are still relevant to your circumstances. We would be pleased to discuss your specific situation and plan the most appropriate course of action for you. For full details about Advison please see our advertisement below.
advison
Independent Financial Advisers
Advison is a small, friendly and reliable firm specialising in Investments, Retirement Planning and IHT Mitigation.
We offer a return to the traditional values only a smaller company can offer, a service we find
is appreciated by the more discerning client. We are happy to see you in the comfort of your own home or at our peaceful and relaxed country offices, which have plenty of free parking.
All staff at Advison are either AFPC or FPC qualified.
----------------This is your opportunity to speak with the experts----------------
• Planned Savings Magazine – National Estate Planner of the Year
• Regularly quoted in the national press for over 10 years
• Used as financial planning experts on BBC, Sky, CNBC, Bloomberg, Simply Money and the Money Channel • Choice Magazine’s Pensions and Trusts expert
Call Kevin or Andrew for a preliminary chat or to arrange an appointment.
No 7, Water End Barns, Eversholt (Nr Woburn), Beds. MK17 9EA T: 01525 288488 E Mail: ifa@advison.co.uk
advison ltd is an appointed representative of IN Partnership the trading name of The On-Line Partnership Limited which is authorised and regulated by the Financial Services Authority. Registered (England) No. 5009271
28 Phonebox Magazine