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How can investors navigate the current crisis?

In the first webinar of our ‘In conversation with Canaccord Genuity’ series, Richard Champion, our UK Deputy Chief Investment Officer and Dermot Hamill, Head of Wealth Management in the Isle of Man, discuss how investors can navigate the current market volatility caused by the coronavirus pandemic. They cover how investors can generate income from their portfolio, the potential risk of negative interest rates and inflation.

 

This video was recorded on 20 May 2020 and is in reference to discretionary portfolio management only.

Despite the last few months seeing some of the sharpest upheavals in economic policy and asset markets ever witnessed, Richard and Dermot remind us here of the fundamental resilience of economies and companies. That markets do recover over time and that from bear markets come new economic expansions and investment opportunities.  

As Dermot explains, staying invested through downturns is key to benefiting from the long-term returns that can be achieved in equity markets – in fact, even missing just a few days in any equity market can limit investor returns. For example, if you’d invested US$10,000 in the US equity market (S&P 500 Index) from 1980 to the end of 2019, it would be worth c.US$660,000. If you’d missed just five of the best trading days during that 40+ year period, the value of your portfolio would be down by around 35% with a value of US$427,000; if you’d missed 10 of the best trading days during this period, the value of your portfolio would be around US$318,000.

As well as explaining our current approach at Canaccord Genuity Wealth Management - why diversification will continue to play a key role for investors during this time and how income can still be achieved - Richard and Dermot remind investors to stay resolutely focused on their long-term goals and to not get caught up in the harsh emotions of the market. At moments like these great change can come about and the crisis already seems to be accelerating some societal changes and creating an ESG (environmental, social and governance) upswell, meaning there are opportunities for investors to explore. As Richard says, “there will be changes that will be for the better and we should focus on that as well” as a new economic expansion begins.

 

Investment involves risk. The value of investments and the income from them can go down as well as up and you may not get back the amount originally invested. Past performance is not a reliable indicator of future performance.This is not a recommendation to invest or disinvest in any of the themes or sectors mentioned. They are included for illustrative purposes only.

This video is for information purposes only and is not to be construed as a solicitation or an offer to purchase or sell investments or related financial instruments.

The information provided is not to be treated as specific advice. It has no regard for the specific investment objectives, financial situation or needs of any specific person or entity.

The information contained herein is based on materials and sources that we believe to be reliable, however, Canaccord Genuity Wealth Management makes no representation or warranty, either expressed or implied, in relation to the accuracy, completeness or reliability of the information contained herein. All opinions and estimates included in this document are subject to change without notice and Canaccord Genuity Wealth Management is under no obligation to update the information contained herein.

Photo of Richard Champion

Richard Champion

Deputy Chief Investment Officer

Richard is Canaccord Genuity Wealth Management’s Deputy Chief Investment Officer, based in our London office. He is a member of the Asset Allocation and Portfolio Construction committees, as well as chairing the UK Stock Selection Committee. Richard joined Canaccord in June 2015. Prior to this he was Chief Investment Officer at Sanlam Private Wealth, and has extensive experience running Global, European and UK equity portfolios, as well as managing money for high net worth clients. He is an Associate of the Society of Investment Professionals.


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IMPORTANT: Investment involves risk. The value of investments and the income from them can go down as well as up and you may not get back the amount originally invested. Past performance is not a reliable indicator of future performance.

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