Market & Portfolio Update - September 2022
September was another volatile month for global financial markets, as central banks reiterated how far they are willing to go to get inflation back to long-term target levels. For example, in the US, this caused interest rates on bonds to rise by around 0.70%, weighing on the returns of bond investments. Share markets were also volatile, as investors came to grips with higher interest rates and slowing economic growth.
While volatility like this can be unnerving for investors, financial markets experience these kinds of events from time to time.
The New Zealand dollar tends to fall during periods when financial markets are volatile, supporting the value of unhedged overseas investments. This is exactly what has happened this time, with the falling New Zealand dollar resulting in unhedged global share investments performing 15% better over the past 12 months than if the foreign currency was hedged or locked in.
The Summer Reset
Summer has a way of easing the pressure. The days feel longer, the calendar softens, and life slows just enough to remind us that not everything needs to be urgent, solved, or optimised right now. It’s a subtle shift, but a powerful one. And it’s what we like to think of as the summer reset.
Lifetime Book Club: Ikigai by Héctor García & Francesc Miralles
“The happiest people are not the ones who achieve the most. They are the ones who spend their lives doing what they love, with purpose.”
That is the central idea of Ikigai.
This is not a hustle manual or a step-by-step guide to success. It is a gentle, thoughtful exploration of what gives life meaning, and how small, intentional choices can lead to a longer, happier, more fulfilled life.