At times like this when it seems that the market only goes down, then you need to approach things slightly differently. There is no sense in merely putting money away only for it to fall – so you need to do your homework first.

First of all I would say that you NEED to be invested, because if you are not in the market when it rises, then you will lose out, so you need to be in it to win it. Bear in mind that the growth in the stock market is really represented in something small like 7 or 8 days and these are the days when you will make the growth for the whole year, so as I said earlier, if you are not in the market in those days – you will lose out big time. The other 250 odd days, the market rises and falls and by and large wipes itself clean so you will make very little or lose very little, and these days don’t count at all. It is only the 7 or 8 days when it goes up big time.

Now that you have decided to be in the market – where do you put your money ? There are 2 main alternatives here and they are 1. Most platforms have a cash facility and whilst this will pay buttons for interest, the simple fact that the money is in the platform and ready to invest at a moment’s notice is the main thing. Then if you keep your eyes on the markets and are ready to invest at a moments notice, then at least you have a chance of getting something. If you had that money in a bank account and wanted to invest quickly, you would find that impossible as it can take a few days to get money on and cleared ready for investing through most platforms – so that would defeat the purpose. 2. The other alternative is that you invest the money into funds that you believe will benefit from any pickup fairly quickly as you may not have much time to get invested. For example over the last few months a lot of tech funds which previously had very good growth, have fallen by a significant amount, so much so that you think that they represent good value if they were to rebound. Remember the old adage of buy cheap and sell dear – and this is what you need to do if you are to get good growth. You may decide to do some research over the long period and see what funds have had a good consistency over say the last 3 years and invest in those. To get a good consistency takes good management and this doesn’t vanish overnight although market factors might have reduced value overnight (or so it seems) so it’s not a daft idea to invest in them as they would be more likely to rebound than others.

Whatever way you adopt, you need to keep watching and monitoring things until they start picking up and then you will see the actual areas that improve most. There are no easy answers and you need to work at it, after all if it was that easy – then everyone would do it.

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