Join the Quill Team in our latest commentary on the Financial Market Update for August 2018.
The S&P/ASX 200 Accumulation Index continued an upward march in August, gaining 1.42% for the month off the back of strong gains in Telecommunications, Information Technology and Healthcare sectors, and up 15.40% for the rolling twelve months.
International share markets continued higher, driven by strong US share performance and a rising USD. Global shares for Australian investors gained 24.71% for the last twelve months.
The Australian Real Estate Investment Trust (A-REIT) sector was up from last month, returning 2.61% for August and improving the 12-month rolling return to 15.68%.
| INDEX RETURNS AS AT 30 August 2018 (%) | ||||
| 1 month | 3 months | 6 months | One year | |
| Australian Shares | 1.42 | 6.16 | 7.33 | 15.40 |
| International Shares | 4.11 | 9.29 | 12.32 | 24.71 |
| Domestic Listed Property | 2.61 | 5.94 | 13.89 | 15.68 |
| Global Listed Property | 1.23 | 4.25 | 12.24 | 7.50 |
| Australian Fixed Interest | 0.81 | 1.45 | 2.65 | 3.84 |
| International Fixed Int | 0.29 | 0.48 | 1.30 | 0.83 |
| Cash | 0.17 | 0.51 | 0.99 | 1.85 |
| Market Indices | ||||
| S&P/ASX 200 Accumulation Index | ||||
| MSCI World ex Aust TR Index $A | ||||
| S&P/ASX 300 Property Trusts Accum Index | ||||
| FTSE EPRA/NAREIT DEVELOP NR INDEX (A$ HEDGED) | ||||
| Bloomberg Composite 0 + Years | ||||
| BarCap Global Aggregate Index Hedged AUD | ||||
| Bloomberg Aus Bank Bill Index | ||||
Fixed interest and cash were modest over the month, with the 0.81% gain in Australian Fixed Interest being the biggest return and for the rolling 12 months to 31 August, returned 3.84%.
The world we live in contains plenty of risks and some of these may impact on the investment markets. The way we manage or use risks can have very different outcomes on our investments, including:
- Permanent loss of Capital – careful investment selection is imperative for minimisation or even avoidance of this outcome.
- Temporary loss of Capital – it is important to not panic after a temporary loss of capital and use your energy to review the qualities of the investment.
- Temporary loss of Opportunity – outside of a recessionary period or financial crisis, when the markets fall it generally occurs to a specific single asset class, sector, or region. So, depending on your aversion to risk, if the fundamentals remain sound, then it may be appropriate to take advantage of the opportunity to invest in something more cheaply than it was previously. This, along with time in the market, is how capital growth can be achieved.
Current Events that may impact the financial market
A couple of current events to keep an eye on that may impact the markets are:
- US central bank policy
- Trade wars
- Chinese growth
- Brexit and broader EU integration
- US foreign policy (Russia, Iran, Turkey, Syria)
Although, it is important to filter out the media hype of headlines, designed to trigger an emotional response, and the underlying facts. It is after a deeper investigation of the facts that will lead to a more rational and logical response to the situation.
Contact Quill Group today
Get in contact with Quill Group today to discover how we can help you navigate through your finances. At Quill, we are passionate advocates for all of our clients and our team is focussed on providing an experience, not just great service. As the largest multi-disciplined financial services practice on the Gold Coast we provide a high touch personalised service delivered with competence, confidence and amazing results.
