Was it a good time to invest in the share market?

I invested a lump sum of money on 25 February. Three days later, geopolitical tensions escalated into conflict between the US and Iran. Was that a good time to invest? (This doesn't take away from the very real humanitarian cost of what is happening in the Middle East.) Moments like this bring into focus how we make decisions as investors. For me, it came down to a few key reflections/points.

Go back to the rationale, not the headline

Whenever markets move sharply, the first question I ask is not “What is happening?” but “Why did I invest in the first place?” That takes me back to my Investment Policy Statement.

My rationale is to invest in a diversified portfolio for a long-term horizon of 15 to 20 years. Nothing about that changed because of a geopolitical event three days later. The plan did not break, so the decision stood.

Probabilistic Outcomes

There is a cognitive bias known as the Outcome Bias, described by Annie Duke as resulting

We tend to think of:

• A Bad outcome equals a bad decision

• A Good outcome equals a good decision

But investing (and decision-making in general) does not operate in a deterministic model. The world is probabilistic with many possible outcomes because we don't know all the information.

A better way to think and make decisions is:

Rationale → Decision → Probabilities → Outcome

There is a 30% chance that markets will fall (within the year) after investing. That does not make the decision wrong. It means the outcome favoured the lower probability over the higher one. A good decision is one made using a sound process, not judged purely by what happens next.

The evidence on lump sum investing

Research consistently shows that investing a lump sum upfront tends to outperform spreading it over time. This aligns with the idea above. Markets rise more often than they fall, roughly 70% of the time( Finlay and Zorn, 2023; Vanguard & Morgan Stanley Wealth Management, 2025). The takeaway is simple. The longer your money is invested, the higher the probability of a positive return.

Ignore the noise, most of the time

I generally do not check my portfolio in the short term. My time horizon is decades, not days. Research confirms that the more you look at your portfolio balance, the more worried and more likely you are to make changes that may not be conducive to your financial success. That said, writing this blog got the better of me, so I checked. The portfolio was down 2%. With all the negative headlines, that surprised me. If it had been down 30%, would that feel uncomfortable? Of course. But it would not invalidate the decision.

Final thoughts

You cannot control markets. What you can control is your rationale, your process and your behaviour. As dentists, we make clinical decisions under uncertainty every day. We know that some treatments work most of the time, and occasionally they do not.

Investing is no different.

 I work with dentists on both financial planning and insurance protection, helping them build a strategy that supports their career, long-term goals and retirement. Email me at ko@tfd.co.nz or text/ring 021469500.

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