Helen Thomas, financial planner at Financial Planning Corporation, said: "We recommend investors continue to take a long-term view and not make drastic changes to portfolios in response to short-term news.
"While we cannot predict what asset classes will ‘be on top’ in the short term, data shows diversification of assets brings better outcomes over the longer term, with investment in markets beating inflation."
She added that, by separating savings from investments, their clients do not have to worry about short-term market volatility because they have sufficient cash.
Thomas added: "Their investments are allowed to grow, keeping their purchasing power over time."
Rachel Springall, finance expert of Moneyfacts Group, said: “Inflation is already having a huge impact, but it also means the power of cash is being eroded if savers are not able to get a return on an investment that can beat it.
"However, the stock market is still brimming with uncertainties, so it would not be too surprising to find investors being more cautious or perhaps having an aversion to funds that might leave their cash at risk.
“Fund performance can go down as well as up and the past year has been no exception. There have been notable losses and growth during the past year because of external factors, which is making it challenging to compare funds with more historic past performance.
“On top of this, the pandemic has impacted the mindset of savers over the past two years, so regardless of current events, it’s important to consider advice carefully before entering any arrangement and understanding the risks of investing in stocks and shares.”
calum.kapoor@ft.com
