How investors should think about a market bubble
Our best resources for whether we are in ‘bubble’ territory and how investors should position themselves.
With equity valuations elevated globally and themes such as AI, gold and tech driving headlines, the question of whether markets have entered ‘bubble’ territory has moved from the periphery to the front line of investor consciousness. In this edition we round up Morningstar’s latest research and commentary, offer key signals to watch and provide practical take-aways for your portfolio.
Are we in a bubble?
Every investor fears the next market crash but what actually causes them, and how can you prepare?
In this episode of Investing Compass, Mark sits down with Lochlan Holloway, Morningstar Australia’s Equity Market Strategist, to break down the psychology and patterns of market crashes, from the Great Depression to the GFC and the rise of AI stocks today.
Lochlan explains why no two crashes are the same (but they often rhyme), why predicting crashes is impossible, and how investors can prepare both financially and emotionally for when markets inevitably turn.
Is the market in bubble territory? Parallels with the late 1990s.
James Gruber’s analysis looks at what’s similar and what’s different to the conditions surrounding the dot-com crash.
Unconventional wisdom: Are investors too worried about the best companies in history?
All this bubble talk needs some context, and Mark is here to provide it. He talks about how investors should think about the composition of the market and why that context is needed in the current market.
In this episode of Investing Compass, Mark and Shani speak with Bianca Rose about how capital market assumptions are built and why they matter for investors planning their financial goals. Bianca speaks to how valuations play a role in investors’ portfolios, particularly important for those concerned about current market valuations.
Ashley Owen runs through why long-term investors should understand pricing and how it affects subsequent returns and wealth.
Many investors are wondering whether they should stockpile cash for an inevitable market drop. Mark explores - time in the market? Timing the market? Going against the herd? Investing success requires a bit of thought to achieve your goals.
In this episode of Investing Compass, Shani and Mark run through what investors should actually pay attention to.
What we can learn from previous market crashes
Shani runs through three market crashes – the Dot-Com bubble, the Nifty Fifty, and the GFC, and the lessons that investors (new and old) can take.
Get your finances on track with Invest Your Way
Morningstar’s book Invest Your Way was released on the 8th of October and is available in 206 bookstores accross Australia. Kindle and audiobook versions can also be purchased.
Invest Your Way is a personal finance book that combines foundational investing theory, real-world application and our own experiences. It is designed to help readers create a financial plan and investing strategy that is tailored to their unique goals and circumstances.
