Over the last four months, these newsletters have contained a series of articles looking at some of the key issues for successful cross-border investing and helping international investors secure their financial future.
In those previous articles, you read about:
- Why embracing market volatility is one of the best ways to achieve long-term investment success
- The importance of staying invested rather than continually trying to time the market
- How a long-term investment strategy can help protect you from the effects of inflation or a recession
- The importance of diversity and investing across all market sectors and regions.
As you head towards the start of a new year, now is a great time to take stock and look at your portfolio.
To help you, we’ve summarised four of the key issues highlighted in those articles, and how they can guide your decision-making in 2026 and help you grow your wealth as a cross-border investor.
1. Volatility is a natural feature of stock markets
Whether you’re investing in the UK or Australia, fluctuations in the value of your assets are inevitable.
Markets are made up of the stocks and shares of different companies. Their performance will be affected by certain factors, such as:
- The success of the business in question
- Wider issues that will affect the whole sector in which those businesses operate
- The performance and actions of their competitors.
External factors will also have a bearing on the value of shares, such as geopolitical issues and economic performance, which is likely to create volatility in individual share prices.
If you then apply that to different markets and sectors, it’s easy to see how it can affect the value of your assets.
Key takeaway: You should accept volatility as an inevitable outcome of markets, and focus on long-term performance rather than short-term movement.
2. Even experienced fund managers struggle to time the market effectively
The idea of timing the market revolves around trying to predict movements in the value of individual shares and market sectors.
These predictions will be driven by economic conditions, research, and analysis.
Most Investment Fund Managers follow this type of strategy as they look to grow the value of their fund. In doing so, they hope to beat their respective benchmarks through their decisions on selling and acquiring stocks.
These Fund Managers have teams of researchers and analysts to support them, along with sophisticated computer modelling programs and a wealth of historical data.
Despite all that, according to Morningstar, only 14.2% of Fund Managers beat their equivalent index in the last 10 years.
Key takeaway: Remember Warren Buffett’s famous adage that investment success is about “time in the market, not timing the market”, and also bear in mind that he cites his favourite holding time as “forever”.
3. High inflation and an economic recession can both be causes for concern
There’s no doubt that high inflation can impact your finances – especially if you’re a cross-border investor.
The rising cost of goods reduces the purchasing power of your money and means you will be financially worse off, unless your income increases by the same rate.
Inflation can threaten business confidence and lead companies to rein in investment as they look to consolidate rather than expand.
This can then result in an extended period of negative economic growth, known as a recession, during which businesses struggle and are more likely to cut costs.
Given how important your investment portfolio is to your long-term wealth, it’s understandable if you have concerns as to how the twin threats of inflation and recession could affect your investments, such as your retirement fund.
Key takeaway: You should ensure your investment strategy is robust and flexible, able to withstand periods of economic uncertainty.
4. Investment diversity can help mitigate the effect of market fluctuation
In a nutshell, investment diversity is about not putting all your eggs in one basket.
If you limit your investment choice to one or two stocks, or companies in a single index, you run the risk that a market downturn could seriously affect your portfolio.
Instead, you can mitigate the risk of market fluctuation threatening your long-term financial security by investing in a range of assets in different industries and geographic locations.
Key takeaway: Diversifying your investments across different regions and sectors is important for your long-term financial success.
Get in touch
Expert advice and regular reviews of your investment strategy can help ensure that you are best positioned to achieve your long-term goals.
At bdhSterling, we specialise in helping clients navigate the complexities of international financial planning. Whether you’re managing assets in multiple countries or planning a move abroad, our expert advisers can help you build a resilient, long-term investment strategy.
If you would like to discuss your own investments, please get in touch with us today.
Please note
The value of your investment can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.
This article is for information only, it does not take into account your personal objectives, financial situation, or needs. Please do not solely rely on anything you have read in this article and ensure that you conduct your own research to ensure any actions you may take are suitable for your circumstances. All contents are based on our understanding of HMRC and ATO legislation, which is subject to change.