Knowledge Hub

Covid-19 Update 9 | State of Play eBook

David Andrew
David Andrew
Posted 11.06.2020 in Company News, Industry Updates
I sense there’s a new mood around the place now that Covid-19 updates social distancing restrictions are beginning to ease. Federal parliament is back, workplaces are buzzing, and cafes and restaurants are filling with excited punters. They’ve even given the chairs back! 

Speaking to my local wine merchant this week, he was grinning from ear to ear just at the Covid-19 update of the prospect of being allowed to open.

Because the store doubles as a restaurant, their activities have been severely curtailed, and it didn’t take much chat to expose just how painful the closure was for them. This pain of Covid-19 is being felt by small businesses everywhere and I hope my eBook can give you some reassurance. 

It seems many in the community think that we are near the finish line of this pandemic, but before we get too excited it’s worth remembering that we still working with an economy at half-pace, our borders are closed and unemployment is estimated to be well over 6 per cent – not counting the three million people on the job keeper payment who are still employed.  With unemployment likely to peak at over ten per cent, I suspect we are at about chapter three of a ten-chapter book.      

Markets

In contrast to the economic reality on the ground, the broad US share market index the S&P500 has recovered most of its losses since the onset of Covid-19.

Having initially dropped 33.67 per cent it has recovered to within minus five per cent on June 7.

This seems unbelievable given the chaos and trauma on the streets in the US.   

In Australia things are more sober.

After initially falling 36.37 per cent between February 20 and March 23, the S&P/ASX 200 has recovered 35.25 per cent. This still leaves the index well down from its peak, but most investors are sighing with relief given the recovery of their portfolios. 

In the last two days markets have been sold off again on news that the Federal Reserve Chair Jerome Powell believed the recovery might be longer and slower than expected. I’m not sure what markets actually expected because it all seems pretty uncertain from where I see it. 

Where markets head from here is, in truth, anyone’s guess. What we do know is that you can be rationally optimistic about the future because things will improve.  If you have not seen my interview with Alex Hof our consultant psychologist you can watch it here. 

How to think about this

Because we’re not out of the woods and because markets may falter again, I want to give you a resource that will help. 

A few weeks ago, I sat down to write a brief article like this – it normally doesn’t take long. Many hours later I got up from my chair and I had penned the first draft of the Survival Guide to Scary Financial Markets.

In the eBook I wanted to provide you with my rationale for why you can still be a confident investor even when things around you are fearful and uncertain. Over thirty years of dealing with financial markets I have seen some scary ones, but certain themes endure. 

The behaviours of successful investors are worth noting and learning from. 

When your certainty is upended the Survival Guide eBook will help you think rationally and when fear and anxiety take hold again, you’ll have the right anchors in place to see it through. 

You can download the Survival Guide for Scary Financial Markets for free. Just click the link. You might like to share it with friends and family if you think they will benefit – feel free to do so.   

If you do have a read of Scary Markets, I’d love to hear your feedback. 

Until next time, 

David Andrew 

 

David Andrew
David Andrew
David Andrew
Founder and CEO of Capital Partners, and author of Wealth with Purpose, David firmly believes that sound, objective financial advice can transform peoples’ lives and wellbeing. Find out more about how our evidence-based approach to wealth planning, investment management, legacy planning and insurance distinguishes our award-winning team, our results and our clients’ lives.