The Financial Impacts the ongoing war in Ukraine is having here in Australia

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Financial Impacts

With the humanitarian crisis and human toll, it is hard to turn our attention to finances but with the Financial Review reporting that the invasion of Ukraine has wiped $73 billion from the share market we need to look at how this impacts our investments and therefor our livelihood.

While the growing list of sanctions against Russia are a necessary tactic in our attempt to support Ukraine, they run the risk of restricting global growth in an already fragile market still recovering from a global pandemic.

When the stock market goes down and the value of your portfolio reduces significantly, it is understandable that you are concerned. However, as panic increases, we wanted to inform our clients that in fact the markets have reacted exactly as expected and we want to caution them against any panic sell-off.

Yes, it has reduced, and if the war persists, may continue to reduce to 15% or even 20%. We know that this is what has happened in the past with any crisis events including wars, terrorist attacks, the financial crisis or even the odd pandemic. The pattern is the same; an initial sharp fall in the share market followed by a rebound. Dr Shane Oliver, Head of Investment Strategy and Chief Economist at AMP has said that recovery of the market could take between 6 and 12 months. The bottom line is, it will recover.

We are now also starting to see the implications of Covid-19 lockdowns with supply shortages and interest rate rises and with China continuing to attempt Covid-19 zero implementing further lockdowns, it may continue to get worse before it gets better.

You may find this becomes, over time, another good buying opportunity which history has proven time again. So, speak to our Financial Advisor, Pallavi Mahajan today to get the best advice for your future.

Contact SMART FINANCIAL ADVISORY on 03 9034 4883 or contact Pallavi directly on 0425 325 951.

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