Market update: March 2022

‍March was a turbulent month in the investment world. The market was volatile. This means that the value of investments moved up and down a lot and often. Sky-high oil prices and central banks adjusting interest rates were heavy blows to the market. Fortunately, the prices were largely balanced in the end. There were also good developments. For example, the job market has not been this good in a long time. The conclusion of March was clear: stocks performed better than bonds.

Best performing fund in March: Northern Trust World Custom ESG Equity Index Fund +3.72%

The investment update

In early March, developed markets, such as Europe and the the United States, took a hit due to the Russian invasion of Ukraine. This trend was slightly restored during the month, partly due to the expected increase in earnings from sectors such as technology, energy and commodities.

Shares in emerging markets had a difficult time in March. This was partly due to the dip in Chinese stock prices, the increasing number of COVID infections in China, and the resulting lockdowns. The American stock exchange may also remove a number of Chinese stocks. This had negative consequences for the prices.

In the United States, the Federal Reserve, the central bank, has raised interest rates for the first time in four years to combat inflation. This led to major movements in the prices of government bonds worldwide.

The returns from money markets in Europe remained low. This is because, unlike the central bank of America, the ECB has not yet adjusted interest rates.

Important factors for your investments in April

- The developments regarding the war in Ukraine

- The energy price

- Extended lockdowns and COVID measures in China

What does this mean for my plans?

The results in March prove the importance of diversification of investments. Because Vive distributes investments across six 'Asset Classes' with passive investment funds that are spread across different companies, countries and sectors, a positive result has been achieved on average. Some portfolios experienced a slight decrease. Given the market conditions, that is a good result. Investing in the mid- to long term has periods when there is no increase or even a decrease in the value of portfolios. The longer your plan lasts, the less you have to worry about the monthly results.