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Mega-crash is coming, get ready! Expert urges act now on Warren Buffett 'rule number one'

Mega-crash is coming, get ready! Expert urges act now on Warren Buffett 'rule number one'

10/17/2021 11:35:00 AM

Mega-crash is coming, get ready! Expert urges act now on Warren Buffett 'rule number one'

A HUGE mega-market crash is fast approaching and people need to act now to avoid inevitable economic disaster, a leading investment expert has warned.

00:00, Fri, Oct 15, 2021| UPDATED:16:29, Fri, Oct 15, 2021Link copiedFinancial expert predicts a market crash in OctoberMake the most of your money by signing up to our newsletter forFREESUBSCRIBEInvalid emailWe use your sign-up to provide content in ways you've consented to and to improve our understanding of you. This may include adverts from us and 3rd parties based on our understanding. You can unsubscribe at any time.

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More infoThe Covid pandemic over the past 18 months has continued to blow gaping holes in markets around the world. Economies are attempting to bounce back and ease their way out of the financial crisis, but some significant and lingering problems refuse to disappear. Tom Stevenson, an investment director at Fidelity International said although it is now known if a sharp correction in markets is around the corner,"the odds are clearly shorter than they were".

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These mounting issues now include inflation, ever-creaking supply chains, surging energy costs, an imminent turn in the interest rate cycle, stretched profit margins and slowing earnings growthMr Stevenson wrote in The Daily Telegraph:"Even if it is not imminent, a correction will happen at some point.

"If you look at the performance of the S&P 500 in the three years following each of the major bear market bottoms over the past 60 years, there has been a pull-back of at least 10pc at least once.Financial crash: People are urged to act now on Warren Buffett 'rule number one'

(Image: GETTY)Financial crash: Markets have plummeted during the Covid pandemic(Image: GETTY)"We are now a year-and-a-half on from the Covid bottom and we are yet to experience that double-digit decline."Given the 5pc or so retreat in September, it is not unreasonable to wonder whether the inevitable correction is under way. It’s going to happen at some point."

The financial expert said he had recently seen something that promised him holding shares for at least 20 years would have given back a return of five percent a year only twice in the past century.He added:"In 40 of those years the average annual return over a 20-year holding period would have been 10pc or higher. headtopics.com

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READ MORE: Financial crash: Warren Buffett is a US business magnate, investor and philanthropist(Image: GETTY)Trending"That really is reassuring if you are 29, but less so if you are 59 let alone 89."For most of us, without a lifetime of investing still stretching ahead of us, there is merit in Warren Buffett’s 'rule number one': don’t lose money."

Mr Stevenson advised people to slightly raise cash holdings, and said:"Remember, you don’t have the same constraints. You can have as much cash as you like, and when that correction does come you will be glad you have it to hand."But remember too that the cash you do hold is guaranteed to lose money in real, inflation-adjusted terms right now.

Read more: Daily Express »

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