Long-term investors do not chase headlines

Norma Falconer
Jan 25
4 min read

Last week’s blog set the rule. Long-term investors do not chase headlines. They focus on what changes outcomes. When the World Gets Loud - Separating Signal from Noise

This week proved why that rule protects you.

The tape looked messy. Rates talk returned. The Australian dollar jumped. Equities moved fast.

The signal sat in two domestic facts. Inflation remains above target. Employment stayed stronger than expected.

That combination drives rates. Rates drive valuations. Valuations drive long-run returns.

Long-term investors do not chase headlines

The week in one sentence

Australia repriced the risk of tighter policy settings after the labour market surprised on the upside, while inflation stayed above the Reserve Bank’s target range.

What happened?

First, inflation stayed sticky.

The ABS monthly inflation indicator showed CPI inflation at 3.4 per cent over the year to November 2025, down from 3.8 per cent in October. Underlying inflation remained elevated.

The Reserve Bank’s own outlook indicates inflation is expected to remain above the 2 to 3 per cent range for a period, easing gradually over time.

Second, employment surprised.

The labour market strengthened in December. Employment rose and the unemployment rate fell to 4.1 per cent. Markets responded by lifting interest rate expectations, with focus shifting to the next inflation print.

Third, the calendar tightened.

The next CPI release and the next RBA decision sit close together. Investors positioned early. That positioning amplified moves in equities and the Australian dollar.

Why this matters for your portfolio

Headlines move sentiment. Data moves discount rates.

When discount rates rise, richly priced assets feel the pressure first. When discount rates fall, the same assets rebound quickly.

That is not chaos. It is pricing.

For Australian investors, the real risk is concentration.

Home bias in Australian shares and banks.
Growth bias in global mega cap equities through index exposure.
Property-linked risk that moves with credit conditions.

When volatility spikes, concentration becomes obvious. Diversification earns its fee.

How to separate signal from noise this week

Use this filter.

Does it change inflation?
Does it change the path of rates?
Does it change earnings and cashflow?
Does it change credit conditions?
Does it change liquidity?

This week, the answers came from inflation and labour data, not from speeches.

The important message

A noisy world tempts fast decisions.

Fast decisions punish long-term outcomes.

Fundamentals decide outcomes.

What you own.
What you pay.
How diversified you are.
How consistently you rebalance.
How well your strategy fits your life.

Your next step with Think Capital Advice

If this week’s volatility raised doubt, you need a portfolio review built around exposures and implementation, not commentary.

Think Capital helps you do three things.

Confirm your objectives and time horizon.
Identify concentration and hidden overlap across super, ETFs, managed funds, direct shares, and property linked risk.
Rebuild the strategy around fundamentals, valuation awareness, and a rebalancing rule you will follow in the next sell off.

Book your appointment to review your fundamentals.

Article - Long-term investors do not chase headlines

At Think Capital Advice, we believe in empowering our clients with tailored financial strategies to achieve their goals. Curious to know more about who we are? Visit our About Us page and how we’re committed to delivering prudent advice, practical solutions, and progressive results.

Learn More About Think Capital Advice

Norma Falconer is a Business Owner, Entrepreneur, Financial Planner, Portfolio and Investment Manager, Personal Insurance Specialist and Estate Planner, in Australia, known for her prudent advice, practical solutions, and progressive results.

As the Founder of Think Capital Advice, Norma combines deep technical expertise with a compassionate, personalised and client-centric approach. Norma specialises in guiding high-income-earning business owners, professionals and their families toward achieving their version of financial independence. Her dedication to excellence is matched by a commitment to making complex financial concepts accessible and actionable for her clients.

She is Professionally Licensed in Australia and South Africa, FASEA-accredited, a Tax (Financial) Adviser, and holds multiple qualifications - including a Graduate Diploma in Financial Planning from Deakin University, a Post-Graduate Diploma of Financial Planning from the University of the Free State, and certifications in results coaching.

Beyond her professional achievements, Norma is an advocate for community empowerment and has served on various boards, including the Cansa Association and Businesswomen’s Association. She is also a best-selling author, recognised speaker, and media contributor, sharing insights that simplify the path to financial independence.

Leveraging 37+ years of working with high-net wealth families, the team at Think Capital Advice excel in working with you to improve financial stability through maximising cashflow, growing wealth, utilising tax-effective strategies, and ensuring that your legacy is protected.

Learn more at Think Capital Advice

References

Think Capital Advice

Long-term investors do not chase headlines

https://www.thinkcapitaladvice.com.au/post/whentheworldgetsloudseparatingsignalfromnoise

Australian Bureau of Statistics

Consumer Price Index, Australia, November 2025. Latest release page

https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/consumer-price-index-australia/latest-release

Australian Bureau of Statistics

Media release. CPI rose 3.4% in the year to November 2025. Published 7 January 2026

https://www.abs.gov.au/media-centre/media-releases/cpi-rose-34-year-november-2025

Australian Bureau of Statistics