Avoid the 'bloodbath': Seniors warned as markets tumble
HOLD on to your cash!
That's the key message for senior Australian investors as key markets around the globe tumbled overnight, with the worst falls on Wall Street being hailed a "bloodbath".
Wealth Partners Financial Solutions's Andrew Heaven advises the US market has come off a remarkable record high and investors should hold onto cash and not sell in a hurry.
"The market is off about four per cent. Obviously, markets opened up this morning down," Mr Heaven said.
"However, on reflection, the All Ords is trading just under 6000 points.
"The key to it is for investors not to rush to make any decisions.
"They need to make sure what they are holding in their portfolio are businesses with good free cash flow that are sustainable and that investors have enough breathing space for their portfolios so they are not compelled to be sellers in the current market.
"In terms of what we are doing with our portfolios, we have been underweight Australian for two years. We see more value offshore and we feel our portfolios are well positioned to ride this out.
"What we are focusing on for retirees is making sure they have a cash buffer so that they can weather the storm and they are not compelled to draw on growth assets in the event that markets remain flat or continue to fall."
Andrew Heaven is an AMP financial planner at WealthPartners Financial Solutions, go www.wealthpartners.net.au. Any general advice in this story doesn't take account of personal objectives, financial situation and needs.