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“Help! All My Stocks Are Down!”

Credit: Amy McTigue

I know that feeling.

Back in the days of the Global Financial Crisis around seven years ago, it would feel like every day is a time for your portfolio to clock losses. Under those circumstances, it would have been easy to throw in the towel and give up on investing.

A similar though less intense sinking feeling may be around right now, with the Straits Times Index (SGX: ^STI) currently sitting nearly 20% below its high in April this year.

The receding tide

Many stocks have taken hard knocks this year.

In fact, when I looked at the share prices of more than 700 companies in Singapore, I found that 69% of stocks had prices at 4 September 2015 that were lower than where they were at end-2014. For the stocks that fell, their average loss was 21%.

Said another way, there is more than a two in three chance that your shares have declined so far this year. And, there’s also a decent chance that your losses have been painful double-digit ones.

But if you are feeling down, do remember that your investing returns should be measured in years and not days or months. I had talked about this in an article late last year on how giving time for your investments to perform can make a huge difference in your returns.

As an example, from its initial public offering (IPO) till today, Suntec Real Estate Investment Trust’s (SGX: T82U) units have delivered capital gains of around 51% in a little over ten years. That may not sound impressive. But if we add in the $0.982 per unit in total that the REIT has paid out in distributions over the same period, this adds up to total returns of around 150% (note that the distributions are not reinvested).

The accumulated dividends collected through time – in this case, more than ten years – has made a significant difference to the returns generated by the REIT.

A Fool’s take

At the Motley Fool, we play the long term game. We can’t tell where the market will go 12 months from now. But we think that if we keep the long-term view in mind, the chances are that we will come out ahead years from now.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Chin Hui Leong owns shares in Suntec REIT.