Fund manager Ben Griffiths from Eley Griffiths has said that the share market may not yet have peaked despite the S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) being down 6.5% this month.
In an article for Livewire he pointed out that the US share market fell due to several factors, mainly the US 10-year bond rates increasing up to 3.24% on the back of strong US payroll data.
Mr Griffiths believes the recent correction could be short-lived, saying "The correction unfolding currently should be viewed as corrective within a maturing bull market rather than a topping market reacting to valuation excess and systemic issues."
He said that his investment firm believes volatility is here to stay in the short-term, but "There is little to dissuade us from our constructive view of equities".
I like his positive way of thinking. Over the long run most 'corrections' don't usually turn into full-on bear markets. It should be expected that the market will occasionally fall by 5% or so in a month. It will also go up 5% or more in a month as well occasionally.
The ASX 200 may be down over the past month, but over the past two years it's up 9.2% not including dividends.
That's the thing with share markets – they have this funny habit of going up over time. Look how far CSL Limited (ASX: CSL) has come over the past 10 years. In another 10 years it's likely to be a much bigger business.
Investment bank Macquarie Group Ltd (ASX: MQG) is another that you would expect is going to be significantly bigger in a decade from now.
Foolish takeaway
Whilst it's hard to say if one particular country or region will be growing strongly in a decade from now I believe the global share market, which we can access through Vanguard MSCI Index International Shares ETF (ASX: VGS), will be materially higher – even with higher interest rates.
We just have to be patient and remain invested in quality businesses.
