Chestnut Financial Services

Chestnut Financial Services, Financial Advisers

Speak to our customer team:

Mon-Sat   9 am to 6 pm

Call Us: 01522 788887

Independent Financial Advisers

Solving Problems For Our Clients

Chestnut Financial Services, Financial Advisers
Investment Advice From Ian Francis Independent Financial Adviser
Investment Advice From Ian Francis, Independent Financial Adviser

Are you worried about the fall in your investments?

If you log into your pensions and investments in the last six months you may be worried to see a fall in their value.

Should you be taking action if you have a long-term financial plan, such as retiring with a good pension fund?

Here’s a typical graph (taken from FTSE250, London Stock Exchange, 21/6/22):

FTSE-250-on-21-06-2022

The chart shows the highs and lows, every day, since 2007.

So, investing is not a permanent rise in the value of investments, falls happen regularly, and on average by over 20% once every four years. It then takes on average 16 months to recover. We are currently 7 months into the decline so we would expect that we are in the middle of the fall and over the next few months to see a return to the longer-term growth trend. Arguably, if you have spare cash now is not a bad time to invest, if you think we are somewhere near the bottom of the decline.

If you just want to see your portfolio going up all the time you may be unhappy. It isn’t something that is going wrong with the funds you are invested in, taking the dips into account your funds are likely to have a longer-term performance similar to the graph above, if they are well diversified.

Financial Planning

What we do is look at your financial objectives – when do you want to retire, what money you need when you do retire, for how long – and then consider a target return, for example 5%.

Our financial plans are 10, 20, 30 and sometimes 40 years ahead. The longer you have been invested in the market the plan will still work, even with recent declines. It won’t be working if you have only invested for 12 months and are expecting to see consistent growth, but for the longer-term investor, the solution is not to change the funds or move things around, all you need to do is to wait for the market to recover.

As financial planners we look at the chart above and imaginatively see a straight line for growth (made up of the averages from the highs and lows). We call the imaginative line the ‘efficiency frontier’, and consider how long will it take for the market value to get back on the frontier. Diversified portfolios will reattach themselves to the frontier over time and will perform better than cash. It has never not happened in the past.

So What Is The Impact of Good Financial Planning?

If you think in those terms, the recent falls have not had any impact on your longer-term financial plan. Despite it being unpleasant to log on and see such falls, they are a normal part of investing and happen every four yours (on average). It is a natural reaction to see the highest point on the growth line and focus on the fall that followed, not understanding that the fall is normal and will bounce back, because it always has done.

History will repeat itself. We just don’t know exactly when.

Where an investor has a higher degree of risk, they will experience sharper and deeper falls in value. But the compensation for that investor is that, over time, the portfolio will return and grow higher than their lower-risk counterparts. If it didn’t grow there would be no benefit in holding investments, just hold cash.

This view holds true over five years plus and only in relation to diversified holdings. In individual stocks this won’t hold true as the movement in the share price will only relate to the short-term performance of a company, not reflective of the collective performance of lots of companies.

Personal Finance Society Qualified Member Logo
What it means to be a member of the Personal Finance Society

Clients requiring financial planning benefit from advice that is clear and concise. Such advice comes from an adviser that is suitably qualified and experienced to advise them and manage their financial planning.

We have been advising clients on insurance solutions for several years now, backed up not just by professional qualifications but also by being directly regulated by the Financial Conduct Authority, so subject to all their rules and regulations, to give you the most suitable deal.

Our team led by Ian Francis Independent Financial Adviser
What's on your mind? Let's talk...

We offer a free, no-obligation, initial telephone consultation for new clients to answer some initial questions and help you with some first steps.

After that, we will then ask if you would like to set aside more time at a good time of day for you, when we can meet in person, on video, or by phone, whichever is most convenient for you.

What Our Clients Have Said Logo
What our clients have said

"We found Ian to be the sort of person that we could trust. That's not easy these days.

We could see he knew about investments and strategies, but he turned the tables around on us and started with what we wanted to do for our lives ahead of us, then worked out a plan of how to get there."

Paul and Mary, Saxilby

Contact Us

Chestnut Financial Services Limited

2a Sadler Court, Lincoln, LN6 3RG

Lincolnshire Police Federation Logo

We are proud supporters of the

Lincolnshire Police Federation

Important Information

The value of investments and any income derived from them can go down as well as up as a result of market or currency movements and investors may not get back the original amount invested.

Past performance is not an indicator of future performance.

Screening out sectors or companies may result in less diversification and hence more volatility in investment values.

Also, tax and legislation may change and your own individual circumstances, including where you live in the UK, will have an impact on your tax treatment.

The guidance and/or advice contained within this website is subject to the UK regulatory regime. It is therefore targeted at consumers based in the UK. Chestnut Financial Services Limited. Registered in England no 9918363, 2a Sadler Court, Lincoln, LN6 3RG. Authorised and regulated by the Financial Conduct Authority.