The Economic Clock

The economic clock is a composite of the individual economic indicators such as interest rates, the Australian dollar, real estate and the share market. The economic clock depicts the sequence of events in an economic cycle that influence the value of the asset classes. Each event in the cycle tends to be the result of the preceding economic condition.

An awareness of the dominant individual components of the clock is useful for both the investor and the individual.

In summary, all three major asset classes, real estate, shares and fixed interest investments, have their time in the sun. Knowing which asset class is in the activity window of opportunity can make a huge difference to the returns from the individual asset and future returns from additional assets purchased as a consequence of the returns from the original.

*This material was taken from the “Strategies for Financial Advancement” course conducted by the National Institute of Financial Studies throughout Australia.

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