Property News · January 21, 2017

Is the FTSE heading for the crash of 2017?


The market is on a record rising run, it can’t go on for everAlmost exactly a year ago, economists at Royal Bank of Scotland advised clients to sell everything ahead of a stock market crash. They forecast a “cataclysmic” year with a 20% slump in shares and oil plunging to $16 a barrel. “Sell everything except high quality bonds,” they said. It turned into one of the best-read stories on the Guardian’s business pages – and RBS was hopelessly, gloriously wrong.On 12 January 2016, at the time of RBS’s forecast, the FTSE 100 index stood at 5929. One year later, on 12 January 2017, the index was at 7337 – an all-time high. Rather than crashing by 20%, the market jumped by 24%. If a client with £100,000 had followed RBS’s advice, pouring all their money into quality corporate bonds, it would today be worth around £106,000 – and probably much less after paying transaction costs. If they had left it tracking the FTSE 100 it would be worth around £124,000. Continue reading…

Source : theguardian.com
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