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Analysts and investors spent most of November worrying about a stock market crash. This was meant to be the big one, as the AI bubble burst. Except it didn’t. So what have we learned?
November ended on a surprisingly upbeat note. Bloomberg called it an “everything rally”, with shares, bonds, commodities and Bitcoin all lifting. The FTSE 100 and the S&P 500 both ended marginally higher, defying the gloom merchants once again.
There’s always a bout of doom every autumn as the Cassandras insist the sky is about to fall. Yet from September to November, the FTSE 100 climbed 5.6%. Over the year it’s up 17.68%. Which tells long-term investors something they always knew. Ignore the speculation. Tune out the noise. Stock markets are doing what they always do. Building wealth, but with volatility along the way.
FTSE 100 holds firm
On The Motley Fool, we consistently pursue the same strategy. Build a balanced portfolio of shares, with the intention of holding them for the long run. That way investors benefit from the long-term outperformance of equities, and can ignore the short term ups and downs.
Timing the market is close to impossible, with one important exception. When markets correct or crash, that’s exactly the time to go shopping for shares. Then it’s a matter of holding them, letting them recover and letting reinvested dividends do their compounding.
As for December, many will now be wondering if we’re due the seasonal Santa rally, when shares rocket towards the end of the year. Whether that materialises will depend on what the US Federal Reserve does on 9-10 December. A rate cut could lift markets, but we never know. They may have priced in the cut and slip back when it lands.
Here’s my remarkable insight. Personally, I’ve no idea what will happen in December. Nobody does. But I do know one thing. While the FTSE 100 held steady in November, the same can’t be said for every stock.
3i Group shares plunge
My biggest holding, 3i Group (LSE: III), crashed by a mighty 28.99% over the last month, the worst performing blue-chip of all. Ouch. That wiped a chunk off my portfolio in one hit.
The group has a proud post-WW2 history of buying unloved companies, sharpening them up and selling them on for a tidy profit. It’s also enjoyed years of success through its stake in European discount retailer Action. Still, even I sensed it had climbed too far too fast and might be due a pullback.
When expectations get too high, even good news can disappoint. On 13 November 3i posted first-half investment returns of £3.29bn, up from £2.05bn last year. That’s a rise of 60%, yet the shares plunged after signs of a slowdown in France.
That hurt but I’m not selling. Instead, I’ve taken advantage by adding to my holding at the lower price. 3i directors have been buying too, which gives me some comfort. I still think the shares are worth considering for investors who understand the short-term swings and are happy to hold with a long-term view. Crash or rally, December will throw up more opportunities like this. I plan to keep hunting for them.

















