Who would have guessed it? Despite the overwhelming hype surrounding the triumphant advent of the "new economy", the stars of the Sharetrack competition are in the "old world".
Against many people's expectations, traditional stocks in the pharmaceuticals, oils and banking sectors have topped the price performance rankings, while darlings of the technology, media and telecoms industries have struggled to avoid relegation.
Indeed, with tech-related stocks such as Baltimore, Iona and ITG remaining among the most popular choices, it seems many participants suffered from the failure to take heed of the adage that past performance does not indicate future returns.
Many participants have also tried to speculate on recent market volatility, some with greater success than others. But while such speculation can lead to a fantasy fortune, it is important to remember that in reality, shares should be treated as a long-term wealth-creating investment vehicle. The essential elements for successful share ownership do not require a "casino mentality" but are encapsulated in the following simple principles.
Know yourself as an investor, detail your financial objectives and establish a clearly developed plan. Understand the characteristics of equities versus other asset classes and allocate your funds appropriately.
Know your investment timeframe and, as a general rule, tilt your portfolio towards equities as your investment horizon extends.
Diversify your portfolio over different sectors and geographical markets, utilising a balanced approach to help manage your risk profile. Understand your risk tolerance and consider the down side as well as the upside of potential investment opportunities.
Know the fundamental characteristics of the companies in which you invest and keep abreast of evolving developments within your chosen universe. Remain true to your investment philosophy and do not make rash decisions in times of volatile markets.
Undoubtedly, some Sharetrack players struggled and may be questioning the merits of equity investing. While this journey can at time prove testing, with patience as a virtue investors can overcome the venom of volatility and enjoy the rewards of equities which have proven to be the clear winner over the longer term.
Laura De Voy works as a researcher in the private client department of Goodbody Stockbrokers
If you would like to speak to the Goodbody team, please visit our stand at The Irish Times/Money 2000 exhibition in the RDS from May 19th to May 21st.
