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

Black father holding daughter in a field of cows
Investing Articles

A FTSE 100 share that could create generational wealth

Investing in FTSE shares can help individuals pass down a significant chunk of cash to their children and grandchildren, data…

Read more »

Investing Articles

Here’s what the BT share price could mean for passive income investors

The BT share price has been falling for years, but that might be about to change. And dividends could be…

Read more »

Investing Articles

At £4.76, is the Aviva share price a steal? Here’s what the charts say!

Aviva has outperformed the Footsie over the last year. But is there still value in its share price? This Fool…

Read more »

Photo of a man going through financial problems
Investing Articles

Does a 43% price drop make this undervalued UK stalwart one of the best cheap shares to buy now?

After losing a third of its value of the past five years, this might be one of the most undervalued…

Read more »

Businessman use electronic pen writing rising colorful graph from 2023 to 2024 year of business planning and stock investment growth concept.
Investing Articles

My top 3 picks today for a £20,000 Stocks and Shares ISA

Here are three very different investments to consider for a Stocks and Shares ISA, covering both the UK and US…

Read more »

Businesswoman calculating finances in an office
Investing Articles

The Darktrace share price has been surging — and it could climb higher

I think the Darktrace share price could have more room to run. Despite the competitive AI industry, the firm looks…

Read more »

Young Black man sat in front of laptop while wearing headphones
Investing Articles

With its 7% dividend, should I be watching the Aviva share price?

Dividend investors will struggle to find many companies with a yield above 7%, so should the Aviva share price be…

Read more »

Investing Articles

Could this be one of the FTSE 100’s best cheap dividend shares?

Looking for the best dividend growth shares to buy? Our writer Royston Wild thinks this FTSE 100 housebuilder might well…

Read more »