Share prices see-saw: all part of riding the FTSE 100 roller coaster

Today, I watched as the FTSE 100 – and the share price of many of its constituents – fell, rose, and finish where it started again. All within a few hours.

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

Mindful young woman breathing out with closed eyes, calming down in stressful situation, working on computer in modern kitchen.

Image source: Getty Images

When investing, your capital is at risk. The value of your investments can go down as well as up and you may get back less than you put in.

Read More

The content of this article is provided for information purposes only and is not intended to be, nor does it constitute, any form of personal advice. Investments in a currency other than sterling are exposed to currency exchange risk. Currency exchange rates are constantly changing, which may affect the value of the investment in sterling terms. You could lose money in sterling even if the stock price rises in the currency of origin. Stocks listed on overseas exchanges may be subject to additional dealing and exchange rate charges, and may have other tax implications, and may not provide the same, or any, regulatory protection as in the UK.

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More.

The FTSE 100 sank to a five-month low earlier — plunging to 6,791 just before 9am — with the share price of a large volume of its constituents nose-diving

Having closed on Friday at 6,987.14, as I write (at 2pm on Monday) it now stands at… 6,987.18.

I chose to highlight these three words in the opening paragraph as examples of fear-mongering rhetoric that, here at The Motley Fool, we strive to avoid.

Instead, we aim to be the calm and optimistic voice amid any chaos when it comes to the stock market.

Of course, this takes nothing away from many of the underlying reasons behind the Footsie’s turbulence right now. What’s going on in Eastern Europe is unimaginably awful, and like many I’m glued to news and updates from journalists far more knowledgeable about the situation than I am.

Where I hope to provide value to private investors is to simply send a reminder that, yes, the nature of the stock market is that it does have peaks and troughs.

We saw that in the first six hours of today.

But what’s so important is the ability to block out a lot of the noise — these emotive words that cause us to worry about our portfolios — and to take a step back.

And then another one.

Over one year, the FTSE 100 is currently up 4%.

In fact, keep going — zoom out enough, and you’ll see what I want you to.

That since its inception in 1984, the index is up by more than 500%!

However, let’s look across the Atlantic to see if we’re an anomaly. 

Year to date, the S&P 500 has cratered by almost 10%…

… but over the past 12 months, it’s up by over 13%.

Across the last five years? +82.5% as I type.

And almost 4,000% — Four. Thousand. Per. Cent. — since 1982.

I really can’t say it enough, so once again I’ll shout it loud enough for the people at the back.

Historically, the stock market goes up.

Don’t be fooled by any so-called market commentators who are trying to grab your attention by highlighting intra-day drops in share prices.

Please (please) instead, do be Foolish — paying special attention to the capital F! — and take a long-term view. 

In all honesty, I haven’t looked at my investing portfolio these past few weeks. I know there will be some ‘paper losses’ compared to when I did last check in.

But I have faith in the reasons I bought into these companies — not just tickers on an exchange, but actual businesses.

And because the research behind these stock picks uncovered growth potential that perhaps the market hadn’t priced into the shares yet, the investment rationale is largely intact.

I remain resolute that the current choppy market is being made seemingly worse by short-term traders.

Yet I’m a long-term investor. So I’m going to close my eyes and ears to any hype-driven oratory on “why we should sell all our shares and buy whatever’s being touted as the ‘right’ safe-haven investment instead”.

I hope you can, too!

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

More on Investing Articles

The flag of the United States of America flying in front of the Capitol building
Investing Articles

2 UK shares that could rise if Trump wins the Presidential election

These UK shares are among the FTSE 100's most popular stocks. And they could rise in value if Donald Trump…

Read more »

Closeup ruffled American flag representing US stocks and shares
Investing Articles

2 UK stocks that could rise if Harris wins the Presidential election

Royston Wild believes these UK stocks could receive a bump if Kalama Harris wins the Presidency, giving their share prices…

Read more »

Investing Articles

After a 96% plunge, is buying more Aston Martin shares throwing good money after bad?

Just two weeks after buying Aston Martin shares Harvey Jones found himself nursing a painful loss. Yet after recent news…

Read more »

Investing Articles

After crashing 45% in October, should I buy this FTSE 250 share for my Stocks and Shares ISA?

Roland Head explains why he’s tempted to add this risky FTSE 250 turnaround share to his Stocks and Shares ISA…

Read more »

Investing Articles

Could I use a stock market crash to turn £20k into half a mil in just over a decade?

A stock market crash might sound terrifying to some but it can also present a once-in-a-lifetime opportunity to accumulate generational…

Read more »

Investing Articles

Recently released: October’s small-cap stock recommendation [PREMIUM PICKS]

We believe the UK small-cap market offers a myriad of opportunities across a wide range of different businesses and industries.

Read more »

Investing Articles

Here’s how a Stocks and Shares ISA and Lifetime ISA could supercharge my wealth!

Individual Savings Accounts (ISAs) can help UK share investors take their earnings to the next level. And their importance is…

Read more »

A person holding onto a fan of twenty pound notes
Investing Articles

A high-yield dividend ETF and an investment trust to consider this November!

Investors wanting to boost their passive income could benefit from investigating these high-yield funds and trusts, says Royston Wild.

Read more »