A note from the team
Currently, there are a few words that are getting unprecedented airtime… words such as uncertain, difficult…
And these aptly describe the world we are currently living in.
Financially, we can see rapidly changing markets and moves that can feel unnerving. However, when looking at previous global pandemic and significant viral diseases, their impact has faded over time, in every instance.
We are not panic-selling equities. Now is not the right time to sell because markets are already pricing-in a sizeable economic hit and share prices are oversold.
Our in-house asset allocation model, ‘Market Pulse’, has just signalled for us to modestly increase our equity exposure, and reduce fixed income and/or alternatives. It is contrarian – it pushes us to buy equities when prices are depressed or falling and sell when prices are over-exuberant or rising.
Making moves such as these often feels uncomfortable, and without the rules we would probably be too wary to take action, so the rules are an enabler. Buying stocks at current prices might not look clever this time next week but could easily look very astute three months down the line.
Overall, ‘hang tight’ is the key message here. Whilst there will be some corporate casualties, there will also be attractive buying opportunities.
When the angst and tumult come to pass, we expect a strong recovery, with companies re-building inventories.
We continue to research, review and make thoughtful decisions for long-term financial success. If you have any questions at all, as ever, do get in touch.