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Point of View Archive

VW and Audi; shame and falling share prices


Volkswagen and Audi: two brands (one company) caught up in the emissions scandal, causing damage to their corporate reputations and the VW share price to tumble.
 
The US Environmental Protection Agency triggered Volkswagen’s fall from grace when they found that some diesel cars were fitted with devices that could detect when the engine was being tested and could change the car's performance to improve results. Audi have now admitted that 2.1 million of its cars were also fitted with the device, which means that they too may face prosecution and fines.
 
Few people could have predicted that the car industry would face such turbulence and falls in value. Last week, when the news of Volkswagen’s corruption broke, so badly tarnished was its name that the company lost a third of its stock market value.
 
It is unexpected events such as these which remind many investors why they chose to work with a financial adviser and in some cases a discretionary fund manager to manage their money. Whether you have a small or a significant sum to invest, there is too much at stake not to be invested appropriately and according to your attitude to risk.    
 
Good wealth planning is all about being prepared for the unexpected. To be saving for the future, to not take unnecessary risk and to have made decisions which are considered, balanced and appropriate.
 
Financial advisers don’t pretend that they can predict the future. They don’t know what is around the corner for stock markets, nor do they know which investment providers are experiencing problems behind the scenes. Rather, what they do is to help their clients grasp a clear understanding of the potential risks they are taking with their existing investment choices, and to tailor that investment exposure to suit individual needs. This means ensuring their clients understand the possibility of market crashes and how long it could take for the investments they currently hold to return to their original value. 
 
No investor wants to feel worried when bad corporate news hits the headlines, which is why for many people it pays to take financial advice.

To find out more about Sanlam’s approach to risk based investments, get in touch, we’d love to help, please email us.

Date issued: 02.10.15

Please remember any views or facts expressed above are based on information received from a variety of sources which we believe to be reliable, but are not guaranteed as to accuracy or completeness. Any expressions of opinion are subject to change without notice. None of the information should be regarded as advice. Past performance is not a reliable indicator of future results. Investing involves risk and the value of investments and the income from them may fall as well as rise and is not guaranteed. Investors may not get back the original amount invested. Any tax treatment is dependant upon individual client circumstances and may be subject to change.

Sanlam is a trading name of Sanlam Wealth Planning UK Limited (Reg. in England 3879955) and English Mutual Limited (Reg. in England 6685913). English Mutual Limited is an appointed representative of Sanlam Wealth Planning UK Limited which is authorised and regulated by the Financial Conduct Authority.

Registered Office: St. Bartholomew’s House, Lewins Mead, Bristol, BS1 2NH.

Investing involves risk and the value of investments and the income from them may fall as well as rise and are not guaranteed. Investors may not get back the original amount invested.