Q: For everyone who is feeling despondent about the unnerving fall in sharemarkets at present, consider this anecdote.

A friend told me the other day that they were pleased their "spare" capital was invested in a holiday home rather than shares at present.

It's a very understandable feeling. However, the reality is that at this moment, the holiday home would probably be virtually unsaleable, and if you were forced to sell, who knows what price you might have to accept — 10, 20, 30 per cent less than a month ago?

But you feel comfortable because you know that the "real" value of your holiday home hasn't changed at all.

Try to feel the same way about your shares. Nothing that has happened has changed the real value of Apple, Unilever, Fisher & Paykel Healthcare, or most of the thousands of other companies that you are likely to be invested in.

The market price of any asset at any point in time is irrelevant unless you actually plan to sell. All that matters is its inherent long-term value.

A: Wise words — which also apply to investors in KiwiSaver and other funds that hold shares.

I've often thought that the price you would get for your house would vary widely if you


Banking on the banks


Time to relax

KiwiSaver switch