Advisers cool in face of sell off
By Will Grahame-Clarke, 6 Feb 18
IFAs react to the sell off that saw stock markets around the world drop sharply on Tuesday morning and tell International Adviser how they and their clients are reacting.
Daniel Zurbruegg, Swiss SEC-certified financial adviser from BFI Infinity, said he thinks the sell-off has little to do with fundamentals or a fear of higher rates or inflation.
“This shows you again what technical/automated selling can do to a market, when there is a forced sale of assets going on.
“A lot of capital is moving the market in one direction and with it, triggers additional selling, it’s kind of a snowball,” Zurbruegg says.
The bets that were made in the market are now being washed out, Zurbruegg said, especially bets that were done in the volatility index, VIX.
“The economic fundamentals remain very good, even with somewhat elevated valuations I think stock markets look pretty healthy. Fear of higher inflation and significantly higher interest rates are overblown,” he says.
Zurbruegg says at present it does not look like the sell-off will develop into a longer-term correction, but it will take a few days to normalise.
“There is always a risk that a bigger correction can develop, and sentiment can turn chronically bearish, but I think the chances of that happening are pretty low,” he said.
Tags: DeVere Group | Forth Capital | Perceptive Planning | Spectrum IFA Group | The Fry Group
