Coronavirus – keep things in perspective

In the modern era, we have far greater access to world news at just the click of a button, or from flash news alerts on our phones.

This is not always a good thing as newspapers and websites publish news stories that will attract readers. It can be all too easy to focus on these stories and get gloomy, disheartened or uncomfortable about the reported danger to life, society or wealth of these threats, the latest being the coronavirus.

Over the past 20 years alone, there have been many material events that we may have felt uneasy about at the time.

However, these world and health events have happened throughout history. Over the past 20 years alone, there have been many material events that we may have felt uneasy about at the time. During such times – at least from a market perspective – it can help to look at the past to ease our concerns. The past may not, of course, repeat itself but markets have been remarkably resilient, as you can see from the chart below.

It is important to remember that in an efficient market current world events and investors’ views are already factored into share prices. As hard as it can be, we need to remember to keep our emotions in check, believe in the robustness of our portfolios and continue on our investment journey with a long-term view. Future news may make the outlook brighter or gloomier. No-one knows.

From a personal perspective these things are worrying, but we live day to day with many higher risks such as driving to work or catching the flu, which infects 1 billion people worldwide every year.

‘This too shall pass’ as the legendary investor John Bogle used to say.

It is worth noting that, yet again, the sensationalist headlines of the newspapers, TV and radio, are not your friend at times like this. It’s perfectly natural to feel anxious; if I was a consumer of the media I’d be anxious too.

The portfolio constructions we use take in to account that these events will happen, at times like these the defensive assets come to the fore. I’m happy to report that the defensive assets are doing their job exactly as intended right now. Year to date performance for the three most used portfolios to end of 9th March 2020 is as follows:

  • EWM P40 Cautious Plus -0.31%
  • EWM P60 Balanced -1.91%
  • EWM P80 Balanced Plus -2.04%

Source EWM/ Betafolio 01/01/2020 to 09/03/2020

When it comes to stock market investing it’s worth remembering that the advance is permanent; interruptions are temporary.

We’re here for you if you want to talk things through.

Dominic

About the Author

Dom is a qualified and experienced Chartered Financial Planner (CII) and Chartered Wealth Manager CFP (CISI) and a Registered Life Planner (Kinder Institute) with over 30 years experience. His work primarily focuses on retirement income planning, helping clients to maintain financial dignity and independence in retirement. Read more from Dominic...
This article is distributed for educational purposes and should not be considered investment advice or an offer of any product for sale. This article contains the opinions of the author but not necessarily the Firm and does not represent a recommendation of any particular security, strategy or investment product. Information contained herein has been obtained from sources believed to be reliable, but is not guaranteed. Past performance is not indicative of future results and no representation is made that the stated results will be replicated.

Comments are closed.

This is my first venture into any kind of personal finance. Your candour and patience with me are very much appreciated. A.S. (London)

Expert Opinion…

Mindfulness – An Evening with George Kinder Replay

Jonathan, September 21st, 2020

Jonathan and Dom met George Kinder over 10 years ago when they were becoming increasingly disparaged by the way Financial Planning was evolving in the UK. They felt there must be a better and more connected way to help people with their financial futures. After providing such insight, they have kept in close contact with George which has led to developing our fundamental ethos at Expert Wealth Management.

Read More
Join The Expert Wealth Family As A Paraplanner

Jonathan, September 10th, 2020

You will be working for an Independent Financial Adviser who hold corporate Chartered Financial Planner and CISI Accredited Firm status, as part of a small team looking after the financial planning needs of around 200 client families. As Paraplanner you will be providing high quality support and ensuring complete and accurate records […]

Read More
Cash dividends: don’t bank on them

Jonathan, August 24th, 2020

‘Do you know the only thing that gives me pleasure? It’s to see my dividends coming in.’ John D. Rockefeller To this day we can still relate to the words of American industrialist John D. Rockefeller, despite their utterance over a century ago. Be it a privately owned business or publicly listed […]

Read More
T: 01993 772467      E: advice@expertwealth.co.uk

Expert Wealth Management, West Wing, The Old Dairy, High Cogges Farm, Witney, Oxfordshire, OX29 6UN


Your Protection: In the unlikely event of your ever having a complaint which we have not been able to resolve amicably, you have recourse to the Financial Ombudsman Service (FOS). This is an independent body which will investigate complaints at no cost to you.  The FOS website is www.financial-ombudsman.org.uk.