Investors reacting to very short-term factors – such as those caused Thursday by the European Central Bank's announcement that it is set to review further stimulus – could be caught out, the chief executive of asset management firm Schroders told CNBC on Friday.
Speaking to CNBC on the sidelines of the World Economic Forum (WEF) in Davos, Michael Dobson said that markets reacting to every single comment from the ECB and its president Mario Draghi could find themselves making the wrong decisions.
European stocks were buoyed on Thursday by dovish remarks from the ECB's president, which hinted at more monetary easing.
At a press conference on Thursday afternoon, Draghi said the bank will "review and possibly reconsider" its policy stance in March. The bank left rates on hold, but in the face of heavy losses on financial markets since the start of the year, Draghi said it would not "surrender".
Draghi's remarks were seen as a clear hint that the bank could unleash further stimulus and prompted European markets to rebound. Dobson said it was important to look beyond the short-term impact of ECB decision-making, however.
"This has a short-term impact on markets which investors need to look through. So I think investors trying to react to very short-term moves will be caught out and will be wrong," he said.