While strategies are likely to vary between investors, “the common ground should be that all investors have a strategy”, he said.

“The most important thing is that all investors have some kind of long-term strategy in place that helps them define what their goals are and what kind of investments best suit them,” Mr Smith added.

Investors shouldn’t wait for a “particular point in time” to develop a strategy, such as when markets reach a certain level of stability, he said.

“In financial markets, it’s always ‘interesting times’ one way or another, so there’s no point waiting until things are ‘normal’ before developing and implementing an investment strategy,” he said.

Mr Smith pointed out that investors can be distracted from their long-term strategies by looking to short-term opportunities, such as tax minimisation schemes. This was a common occurrence during the global financial crisis (GFC), he added.

“[It’s important] to avoid knee-jerk reactions according to market volatility,” Mr Smith said. “It’s easy to get sidetracked by what is happening in financial markets, but investors need to make decisions based on where they are, not on where the market is.”

“Indeed, following the GFC, many people abandoned any concept of a diversified approach by putting everything into cash.”