I want to keep you abreast of developments as the world economy faces one of its biggest challenges in years, with the coronavirus outbreak and a price shock in the oil market.
Although diversified, our portfolios aren’t immune to the effects of current volatility, so we wanted to provide you with some context to the current events and explain what we’re doing to respond.
Last week, the World Health Organisation officially declared Covid-19 global outbreak a pandemic. This has understandably impacted financial markets around the world as governments try to take measures to control its spread.
Equity markets have officially entered bear market territory with major equity indices declining more than 20% from highs. Capital markets have been excessively volatile as the global economy has suffered major disruption by temporary country-wide and community shutdowns. Equity and bond markets attempt to price in the uncertainty of the impact on the global economy and corporate earnings. Some industries will be impacted more than others.
An argument can be made that this is a much better time to invest with most equity markets closer to fair value and significantly discounted since market highs. However, timing the market is fraught with danger and it is still unclear how long the covid-19 business impact will be felt. Now, more than ever is a time for investor prudence and we believe that the next few months will not see any significant investor capital market upside.
We remain focused on long-term returns, cost reduction, and ensuring that risk levels are appropriate to your personal circumstances. History tells us that low fees combined with patient, long-term investing has always reaped rewards.
We are experienced, chartered financial analysts (CFA) and asset managers and are committed to protecting and growing your money at all times.
Thank you for using Brite Advisors. We promise to do our very best to support you as we face this challenge.