This year has proved a hair-raising experience for investors thus far, although Barclays’ latest Equity Gilt Study provides a comforting reminder that it generally pays off to sit tight during the bad times. The study notes that, over the last 119 years, UK stocks outperformed cash in 69 per cent of two-year periods. The longer you hold on, the better your odds; equities win in 76 per cent of five-year periods and 91 per cent of 10-year periods. The other obvious takeaway from the historical data is investors really should resist the temptation to spend their dividend income. After inflation, an investment of £100 in 1899 was worth £35,790 at the end of 2019 if you reinvested your dividend income. If you didn’t, however, then that same £100 investment would have grown to only £193.

The US figures are similar; after inflation, $100 invested in 1925 would have grown to $46,139 if you reinvested your dividends, compared with only $1,455 if you didn’t. The dividend figures are testament to the magic of compound interest – over time, small sums really do snowball.