Keep calm and stay invested.

Morton Fraser Wealth and Pension Planner Norman Dalgleish
Norman Dalgleish
Wealth and Pension Planner
03 November 2020

It has been quite some time since I last provided an update, and I think that was because for a while it did feel like we were in a relatively steady state, post lockdown easing. However, with the second wave apparently now upon us, things definitely feel more uncertain again.

The summary of my recent client meetings has been fairly consistent: investment values fell sharply in February and March, but for a diversified medium risk portfolio the investment value is now broadly (within a few percent) back in line with where it was a year ago.  This seems slightly remarkable given the changes in the world over that time, but the stock market is a forward-looking mechanism and so appears to broadly be of the belief that some form of economic normality will return within the next couple of years, albeit some sectors will recover much more than others.

Without wanting to be too political, there is also the reality that the UK appears to have been disproportionately hit in both health and economic terms when compared with many other countries.  And on top of this we are currently adding in the uncertain outlook for the end of the Brexit transition period.  Therefore, viewing the world from a UK perspective perhaps gives a slightly more pessimistic assessment than the global reality.

The following chart shows the performance over the last year of the UK stock market, the global stock market (excluding the UK), and a typical medium risk diversified multi-asset fund.  The chart shows that the diversified fund has indeed recovered back to late 2019 levels.  In contrast, the UK market remains far below.  And the rest of the world has, post the fall of the early spring, recovered and been hitting new all-time highs.  This geographic disparity is at least partly driven by the significant technology element in the US market, a sector largely absent to a "UK only" investor.  (Source:

FT Chart

So, seven months in the message remains the same: keep calm and stay invested.

The passage of time since this all started seems remarkable. Long enough for us to have now watched all eight episodes of The Mandalorian, twice, and to be eagerly awaiting the second season which launches at the end of October.

It is always the case that the highlights of a financial planner's working life are the moments of client contact, be those face to face meetings or telephone/video calls. That truth is only magnified when working from home, so please get in touch if we can be of any assistance.


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