A RETIRED equity fund manager has warned retirees are still panic selling investments because of the impact of COVID-19 on share markets.
Peter Jackson, who worked at Sydney-based Investors Mutual Limited for 20 years, believes retirees will lose out in the long run if they continue and has urged them to hold fast.
“We are dealing with something the likes of which we’ve never seen before,” Mr Jackson told the Voice.
“People are panicking and are scared they are going to lose their retirement funds.
“Lots of people are selling their shares in a desperate attempt to hold on to their money. This is exactly how they will lose their money.
“It’s just a matter of waiting for the markets to recover. Share value will go back up and their investments will yield them a lot more if they hold on to them instead of selling them now at a low.
“It’s a tough time for most people…if you sell shares and sit in cash, you’ll be going backwards financially,” he said.
Veteran investor Jim Rogers believes the stock market will drop even further as the pandemic continues, meaning retirement savings could be worth substantially less money.
His views are supported by TS Lombard, a team of experienced economists and analysts.
“[The] real bear market starts now,” Lombard’s head of strategy Andrea Cicione warned early in May 4.
Mr Cicione said US president Donald Trump’s $US2 trillion stimulus package wouldn’t stop the world’s biggest economy from slipping into recession, while the five big technology companies Facebook, Amazon, Netflix, Alphabet and Microsoft had been great performers in the past but couldn’t hold up the share markets alone.
Jean Beaton, an 88-year-old local retiree, is not concerned for her money or investments.
“I haven’t sold anything; I’m actually looking to buy more Westpac shares,” Ms Beaton said.
“Dividend payments will probably be less, but the value of the shares will be okay.”
University of WA professor of finance Raymond Da Silva Rosa has good faith in the economy and its resilience. “There’s a reasonably good prospect that the market will recover quite well,” he said.
by ALEXANDER PERRY