Interactive Investor

Dinah Wolf: how this investor prepares for her summer holiday

28th July 2021 13:48

Dinah Wolf from interactive investor

It’s been a crazy year for everyone, and we all deserve a break, but investors should do this before switching off for two weeks.

My freezer is brimming with ice cream, the coffee table is laden with books and my summer wardrobe is (finally) ready to see the light of day. Bring on staycation 2021.

Holidays (at home or otherwise) are crucial. They allow us to recharge, engage in light-hearted activities (I plan to learn how to play croquet and poker) and above all give our minds a rest from all the hustle and bustle (which I so thrive on) of our day-to-day lives. 

My philosophy is that your portfolio should be crafted in such a way that it doesn’t lead to obsessing and fussing over (short-term) market moves. Hint: if you find yourself constantly checking share prices, then you probably aren’t comfortable with the amount of risk you’ve taken on.

With holiday season upon us, the last thing you want is to be ‘that’ guy (or girl) who keeps on glancing at their phone by the pool. Not a cool look. So have a tinker with your portfolio and rebalance or further diversify your holdings if need be to keep those stress levels at a bare minimum.

My stock watchlist (that I’ve narrowed down to 30) almost feels like a group of passengers on a plane spanning continents all with the same goal: to arrive (safely) at their destination. To give you some clues (a handful of) these passengers are royals (Rolls-Royce (LSE:RR.) among them) and billionaires (Bumble (NASDAQ:BMBL), Virgin Galactic (NYSE:SPCE) and Wise (LSE:WISE)), but you’ll also find a bunch of not-so-flashy rather humble folk (Honest (NASDAQ:HNST)).

I haven’t bought these stocks because markets have been quite volatile lately and, with corporate results season on us, I’m holding off, just for the time being. But during the summer, I will have a sneak peek (not by the pool, of course) to see how my imaginary passengers have fared, so come the end of August I’ll be ready to maybe bag a few in my ISA.

Inflation has cast a shadow on what would have otherwise been a rather carefree summer lapping up growth and dining with tech. Over the next few weeks, I’ll be keeping a very close eye on that beast to see where things go. It will be a good test to get a glimpse into whether inflation may be transitory after all (something tells me it’s not).

The summer months are usually quiet periods as trading volumes wind down. I suppose even those macho bankers need a break. Not-so-frequent trading will be paired with a deluge of corporate results in the late July/early August quarterly earnings season, making for a volatile few weeks. If you do find yourself sitting on some lovely extra cash (I for one will not be travelling abroad), the summer is a good time to pick up those stocks (or top up any funds) that might have taken a hit of late.

Summer is my favourite time of year as it presents itself with the perfect opportunity to reflect and take stock (literal or otherwise). Did you hold your nerve? Have you stayed strong to your convictions? If the answer is no, take a deep dive (preferably out of water) and identify those sneaky biases. Trust me, we all have them. And the sooner you spot them, the better.

On that note, have a wonderful and well-earned break. Happy Holidays, fellow investors! 

These articles are provided for information purposes only.  Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties.  The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.

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