Buy and hold a diversified portfolio and sit tight during the bad times. That’s standard financial advice, which is why behavioural finance experts suggest you’re better off not looking at your portfolio too often, as doing so will increase the odds you get spooked and sell in panic.
Unfortunately, it appears European regulators disagree.
What happens to the Northern Ireland protocol now?
Last week, I got a notification from my broker that a holding had declined by “a minimum” of 10 per cent since I bought it. It wasn’t the first such notification I got this year, and it may not be the last. That’s because every 10 per cent decline must be reported to clients under Europe’s MiFID II regulations. The emails I receive are automated; I cannot turn them off.
Thing is, my investment horizon is 20 years or more. I don’t care about 10, 20, or even 50 per cent declines; I want to be boring, to sit tight and continue monthly investing for my eventual retirement.
‘They think they’re no good and that they shouldn’t be in this world’
Jonathan Coe: ‘The morning after the election felt like waking up in a safe room, having been in an abusive relationship for 14 years’
Irish postpunk band Gurriers: ‘Everyone asks about the Dublin music scene. It’s not just Dublin any more, it’s everywhere’
Hugh Linehan: Cillian Murphy’s Small Things Like These has become a cause celebre of the Make Ireland Great Again brigade
These reminder emails won’t affect me, but they may well affect other ordinary investors. Sticking to an investment plan isn’t easy in bear markets; the last thing investors need is a counterproductive regulatory rule that fosters over-trading and short-termism.
