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When will our sharemarket reach 6
000 points?

When will our sharemarket reach 6,000 points?

Nathan Lear
Partner/Private Client Adviser
18 May 2015

The major benchmark of Australian listed company shares, the S&P/ASX200 index, has been hovering close to the 6,000 points mark for most of 2015. 

Source: Yahoo Finance
The Australian sharemarket is still 16 per cent below its all-time high of 6,851 reached in October 2007 however as can be seen by the above chart, over the past six months, the market has come within a whisker of 6,000 points on a number of occasions, failing to break through.  

The last time our market was above 6,000 points was early in 2008, which is now over seven years ago. 

Recent gains in the sharemarket in early 2015 have some commentators warning that our market is once again expensive, advising caution as good returns are compromised relative to the risk that is being taken.

At Hewison Private Wealth we adopt a diversified portfolio asset allocation approach for our clients, with assets spread across the major sectors, not just Australian shares.

Dependant on individual circumstances, we generally take the view that our clients should have part of their portfolio invested in Australian equities at all times. We then manage the risk by rebalancing our client’s portfolios target allocation to this sector over time. 

Timing the market can be dangerous. Many investors have got themselves undone trying to time when to time markets. As the great Warren Buffet says, “our favourite holding period is forever.” Provided the business that you own is quality, why wouldn’t you want to own it forever?

Assume you own an investment property in a blue chip location. It’s unlikely that you would consider selling it only to buy it back down the track.   

It is inevitable that our sharemarket will reach the 6,000 mark. The million dollar question is when? Provided you have exposure to the sector via quality Australian company shares, your portfolio will benefit when it does inevitably pass through this level. 

Hewison Private Wealth is a Melbourne based independent financial planning firm. Our financial advisers are highly qualified wealth managers and specialise in self managed super funds (SMSF), financial planning, retirement planning advice and investment portfolio management. If you would like to speak to a financial adviser on how you can secure your financial future please contact us 03 8548 4800, email info@hewison.com.au or visit www.hewison.com.auPlease note: The advice provided above is general information only and individuals should seek specialised advice from a qualified financial advisor. The views in this blog are those of the individual and may not represent the general opinion of the firm. Please contact Hewison Private Wealth for more information.