Don’t panic – consider the longer term says The Share Centre

As investors worldwide remain anxious about the credit crunch and its knock-on effect, The Share Centre is advising investors to remain positive and reminding them that these periods of volatility can present opportunities for long term investors.

As the extent of the subprime crisis has emerged over recent months, concerns over the outlook for Western economies have grown, leaving banks increasingly reluctant to lend to businesses and consumers. This combined with negative economic indicators and corporate news of banking casualties, Northern Rock and more recently the American investment bank Bear Stearns, continues to add fuel to the fire. However, despite this uncertainty, and the likelihood there is more to come, investors should remember that equities are long-term investments.

Commenting on the news of Bear Stearns and investing in volatile markets, Andy Parsons, Advice Team Manager at The Share Centre said: “The concerns and fears for investors show no signs of slowing down, as the home of the credit crunch loses its first major bank during these turbulent conditions. There is no doubt that investors are in for a bumpy ride, but we should remember that equities are a long-term investment - there will always be periods of volatility followed by uncertainty, but history has proven that equities still remain a relatively stable investment over the longer term.

“When investing in volatile times such as these, it is important to consider your attitude to risk as well as your future financial aspirations. Longer term or more cautious investors could take advantage of the pound cost averaging technique; purchasing additional banking stocks they feel are currently undervalued so to balance out their original investments. However, more adventurous investors could look to dip in and out of the market to take advantage of the short term opportunities a volatile market can bring. If investors are at all unsure about what to do, or need some reassurance in times like these they should seek individual investment advice”.

The Share Centre provides advice for registered customers at no additional charge.