2020 Newsletter July

How was your lockdown?

Mine had some positive outcomes.

For a start I have stopped using my car and instead use technology. Necessary under the lockdown rules, it has had a distinct impact upon improving the air quality throughout the world and to my well-being.

By staying home and acting locally, I have freed up all those hours spent travelling. I have benefited hugely by embracing the latest technology, allowing me to attend virtual meetings and client reviews, attend industry conferences and have detailed conversations with the investment managers. 

Experts, such as scientists and health professionals have been saviours, technology companies and pharmaceutical businesses have risen to the challenge and the best minds have been focused on a fairer and cleaner world. If sustained, this should deliver something better for our grandchildren instead of a dead planet.

How are your savings and investments performing?

It’s early days yet, we don’t know if there will be another major outbreak, which would have a negative impact on traditional investments but, so far, the recovery of the stock market continues.

As an adviser with experience of managing funds during the 2009 financial crisis, which did take 18 months for things to return to positive, I am quietly confident that ethical and sustainable investing (ESG) has proved its worth.

Since then things have changed.
Even in 2009 there was sufficient difference to show that well-run companies, which by definition meet many of the requirements for ESG, had stronger more robust balance sheets.

Sometimes achievement is based on a conviction that the future will be different than the past.  Looking back at past performance is not a guarantee for the future; much better to look forward at what will matter in the coming months and years.

Based on current evidence the climate, our medical services, care facilities and the use of technology will have an increasing role to play in the way we, our politicians and our societies adapt and change. So far so good.  How have ESG investments performed during the crisis?  They have out-performed other mixed investment.  Now we have the proof of what had been faith in our conviction.

Our ESG portfolio, with a risk rating of 7 [Highest Medium] dropped by 19.2% on the 31st March, is now back to its pre-April value. Our least volatile ESG with a risk rating of 4 [Lowest Medium] dropped by 13.7% on the 13th March and is now 1.87% above is pre-April value.

Had any of our investors decided to leave the funds and go to cash, they would be looking at substantial loss.

Going forward, given the structural changes that Governments plans, and our experiences during lockdown, life and markets will be different.  Your savings, pensions and investments need a radical approach. 
Ethical Social and Governance (ESG) must be central. 

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Jan Oliff Financial Planning is Authorised and Regulated by the Financial Conduct Authority
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