Since striking out alone in April 2021, Ascenta Wealth has enjoyed successful growth.
We’ve gone from a team of three lifestyle financial planners to four, with Simon joining the team in 2024. And the number of internationally mobile families turning to us for support and guidance on their journey to financial freedom continues to grow year on year.
Alongside the success we’ve enjoyed as a company, global stock markets have experienced significant growth, despite a difficult backdrop.
The MSCI World index saw an average annualised return of roughly 13.1% over the past five years, with total returns exceeding 84%.
Here are five pivotal events that have affected markets and investor portfolios since Ascenta Wealth was formed.
Covid vaccine rollout led to a “V-shaped” recovery, followed by inflationary pressures
Ascenta Wealth came into being when the coronavirus vaccination campaign was beginning to gain greater traction.
In 2020 the global economy contracted by 4%, the worst downturn since the second world war.
Focusing on the S&P 500 alone, between 19 February 2020 and 23 March 2020, the market lost approximately 34% of its value. But by the time 2021 dawned, it had made a complete recovery and then some.
Following the pandemic, while stimulus spending kept markets strong throughout 2021, by 2022 this had caught up with us and countries around the world suffered from a surge in inflation.
Singapore fared marginally better than other countries, seeing inflation rise from 2.3% in 2021 to a peak of 6.12% in 2022.
One positive financial outcome of the Covid pandemic was that many households managed to accumulate substantial savings during extended lockdowns and restrictions.
The Russia-Ukraine war
Moving beyond the effects of Covid, we entered 2022 hoping that inflationary pressures would start to subside.
However, when Russia invaded Ukraine in February 2022, investors faced another layer of uncertainty as stock market values dropped.
As well as the dreadful humanitarian crisis the conflict created, global energy markets were disrupted due to sanctions that cut off Russian oil and gas supplies. Meanwhile, wheat and fertiliser shortages affected food supply chains, causing prices to increase steeply.
Following the initial sharp decline in the days immediately after the invasion, equity market performance began to rally from mid-March.
Suffice it to say, 2022 was a tricky year for financial markets. Indeed, according to Forbes, it was the worst year bonds had ever experienced and the seventh-worst on record for the S&P 500.
As ever, we provided a steady voice of reason, helping clients to remain calm, patient, and invested, ready to reap the benefits of future rises.
The emergence of the Magnificent Seven and rise in AI
In 2023, seven US technology companies were coined as the Magnificent Seven. Between them, they proved to be the best-performing growth stocks in the technology industry.
Dominating the global stock market, the Magnificent Seven companies include:
- Alphabet (Google’s parent company)
- Apple
- Nvidia (a US graphics chip-making company)
- Microsoft
- Amazon
- Meta (formerly Facebook)
- Tesla
Together, these companies carry an extraordinary amount of weight in global markets.
In fact, as of August 2023, their value equalled the combined stock markets of Canada, France, the UK, China, and Japan.
Indeed, those who hadn’t invested in the Magnificent Seven during 2023 may have experienced disappointing investment returns.
According to CNBC, the group experienced positive returns of 107% over the course of the year, while the MSCI USA index grew by 27%.
Of course, it’s always important to remember that past performance doesn’t guarantee future returns. And while many investors hold these stocks in varying degrees, diversification is paramount.
With tech companies pouring funds into AI, UBS suggests that total AI spending could reach $500 billion in 2026.
As ever, however exciting the next big thing appears to be, a diversified investment portfolio could help you to stay on track to achieve your financial goals with confidence, stability, and peace of mind.
Trump’s tariffs
On 2 April 2025, President Trump announced a package of import duties, imposing tariffs on countries across the globe.
Dubbed “Liberation Day”, the tariffs set a new precedent for US trade relationships with countries all over the world.
Although markets had been bracing themselves for the announcement for weeks, once it landed, the fallout proved more extreme than many investors had predicted.
Fortunately, the fear faded quickly.
Six months following Trump’s initial announcement, JP Morgan reported: “Major indexes haven’t just bounced back – they’re hitting fresh highs. What looked like a breaking point sparked a historic rally.”
Iran-US war
In the here and now, the situation in the Middle East continues to unfold.
Threatening the lives of many civilians in multiple nations, the war is also having a commercial impact.
Energy prices are rising, the price of gold – usually considered a safe haven – has declined sharply, and stock markets remain volatile.
While we may see more uncertainty over the coming weeks and months, we encourage you to resist the urge to react. Staying invested will mean you’re well positioned to benefit when markets rebound and begin to recover.
Five key investment takeaways
As we navigate this current uncertainty, here are five reminders to help you keep calm and remain invested.
- Look back at history. While past performance is not a reliable indicator of future performance, historical market trends are a reassuring reminder that markets can recover and reach new highs, even after severe volatility.
- Diversification is your friend. Diversification and careful planning mean your investments are positioned to handle temporary downturns. Short-term losses in the value of your investments could be offset by gains elsewhere.
- Avoid checking your portfolio too often. In the age of the 24/7 news cycle, it’s easy to listen to the hype and anxiously monitor your investment portfolio every day. Take a step back and remember that you’re in it for the long term. If you’re not yet reliant on your investments to provide an income, checking your investments once a quarter, or even just once a year should be adequate.
- Don’t try to time the market. When markets fall, some investors are tempted to try to time the market by moving to cash and then looking for the perfect moment to reinvest. In our experience, investors who try this will likely experience lower returns in the long term than those who stay invested.
- Remember what you’re investing for. Whether you’re aiming for financial freedom in retirement or want to ensure you can afford the best for your children’s education, remembering why you’re investing your money could help you keep a clear mind and resist the temptation to react to short-term fluctuations.
Five years strong and here to help
Through good times and bad, we’re here to support you on your journey to financial freedom.
If you’d like to discuss your investment strategy or are interested to learn more about how we could help you and your family, please get in touch.
