As I am sure my Editors will confirm, I cannot stand being late. My dear departed Father always reminded me that “timing is everything.” In order to fit in with the publishing deadlines of this illustrious periodical, in what is currently a busy time for me, I sit down to write my column at the last moment. As a result of this (and the reason for this preamble), is to say that I am writing on 11 September. The anniversaries of world events can often colour the judgement of those who impact upon financial markets, though there is no reason why they should. I say this, because it is often difficult to see why markets perform as they do. So many things dictate how markets react that analysing such factors is a full-time job, and a somewhat inexact science.

The real problem is that of sentiment: it is not so much a matter of exactly what events have happened, more importantly what someone – or some people – think about such events. Specific factors will have a bearing on what happens in financial markets: interest rates, national and international issues, energy prices (especially oil), individual company and sector performance, and often the most dramatic factors, fear and greed. Fear of what might happen can have more influence than known factors; when markets are performing well, and conditions are benign, the sheer act of investors wanting a piece of the action creates further demand, and, with limited supply, this demand (or greed) adds to the rise in prices. I have long said that when the broadsheets are full of advertisements, stating how well the Fund Managers looking after your money have performed in the short-term, if you are a little risk-averse, it might be time to look for some bargains elsewhere, or an adjustment, to move your profits into somewhere less volatile.

This said, if you believe in the equity story in the long-term, then put your newspapers in the recycling bin, and get on with life. It is too short, and if you make it shorter by worrying yourself into an early grave over the value of your investments, then de-risk them, and relax!

Since my last column, and the comments therein regarding the FTSE100, it has been shaken by the performance of the Chinese economy and the related markets, having most recently closed down at 6117. An old adage in investing is “sell in May and go away – come back on St. Leger’s day.” This year that may well prove to have been sage advice. My view on the benefits of the long-term holding of stocks remains the same, and if one has a little to spare of the old “hard-earned” then it would appear to be a decent time to invest. This is, however, a risk business and one should never consider investing over a time frame of less than 5 years, and, ideally, substantially longer (unless it is your way of making a living). For the huge majority of us, save for the short-term and invest for the long.

In closing, I’ll return to 11 September to spare a thought for those poor people who were lost in that tragedy, but also to say Happy Birthday to my lovely “No 2 Son” Sam, who was born as the horrors unfolded.

Make the best of the season of mists and mellow fruitfulness and hope for an Indian Summer. I’ll have more to say in December.

David Foot