What is the new ‘Normal’

11.09.2020

Looking back on my last communication, I advised we were preparing for the move to our new office in Bristol. I am pleased to say, our team of Sara, Kate and Andy have successfully completed the office refit and delivered a professional and personalized space for us to work. As the Finance Director, I am especially delighted they were bang on budget, so a big thank you to all involved.

As a taster, this is the original mural we had painted on the main wall by a young Bristol artist Wei Ong (Silent Hobo). As you can see, he has captured the Brunel and Ironbright logos in the Balloons going over the iconic Clifton Suspension Bridge. I must say, we were all ‘blown away’ by Wei’s mural. Assuming a return to face to face meetings next year, we will be delighted to meet you at our new office if you wish and show you around.

Brunel Capital Partners - Wei Ong (Silent Hobo)Whilst writing this, I am recovering from a dose of anesthetic following a trip to the dentist to have a crown fitted. It did make me think if we were returning to some normality as this work has been deferred since lockdown. On seeing my dentist fully PP’d up and advising he could only see 2 patients a day for this type of treatment, I realised we are still some way off the ‘normal’. This is reinforced by the government announcements as we see saw between the daily changes of numbers of people we can see or the daily changes to quarantine rules if we have managed to travel abroad.

So, as we move into Autumn, the never-ending Brexit negotiations are back in the news. It is clear from what we have seen in the financial markets this week, the daily news flow on deal or no deal continues to impact on the direction of the UK stockmarket and £ exchange rate. I have picked a couple of interesting articles on this subject for you to read if you so wish.

https://www.theguardian.com/commentisfree/2020/sep/07/boris-johnson-deal-eu-britain-talks

https://ukandeu.ac.uk/the-uk-economy-brexit-vs-covid-19/

To reinforce Steve’s message last week, even with these Brexit and Covid 19 concerns, the Ironbright investment philosophy continues to follow its 3 guiding principles – Belief in the future, patience and discipline. We are optimistic and believe in long-term progress. Capital Markets work. They are far from perfect, but they do a good job of fairly pricing all available information and investor expectations about publicly traded securities. Once money is invested, patience is needed with an eye on the long term rather than what markets are doing today; and discipline, delivered through careful asset allocation, diversification and regular rebalancing of asset allocations to keep portfolios in line with the course set.

Whilst we navigate through this uncertainty, we continue to ensure your financial plans are on track and anticipate meetings will continue by Zoom or Teams. Even though it is not quite the same as a face to face meeting, I was re-assured from the feedback I had from a client meeting I held yesterday, where we had some complex scenarios to navigate, we can still deliver effectively your lifetime financial planning through a virtual meeting.

Stay healthy, safe and optimistic.

David Buchan
Finance Director

David Buchan

It’s not all bad out there…

04.09.2020

Earlier last week the S&P 500 index (a market capitalisation-weighted index of the 500 largest US publicly traded companies) completed its fastest recovery from a Bear Market in history. At its lowest point, year to date, it was down just over 20%, but at the time of writing it is up just over 10%. It’s madness.

Anyone with half an eye on the parlous state of the world economy may agree that this is quite extraordinary. The pandemic has caused enormous pain on global businesses with dividends being slashed, companies announcing mass redundancies and recurring profits warnings from the great and the good.

Investment markets have many drivers that determine its pricing, which I will not bore you with here, but there is an adage in the industry that there are 3 things you need to know about the stockmarket:

Rule 1: “the stockmarket is not the economy”.

Rule 2: “the stockmarket is not the economy”.

And “yes” you’ve guessed it…

Rule 3: “the stockmarket is not the economy”.

Aligning the current state of the economy to the value of your portfolio just does not compute – it never has. The majority of you do not like too much excitement, which means that you invest in the IronBright 50 portfolio or in lower risk-rated ones, such as the IronBright 30 portfolio (we go up in factors of 10 to the IronBright 100 portfolio, which is entirely equity based and is a little bit racy).

The performance figures year to date are interesting because if you looked at them, you would never guess there is a global pandemic and an economic meltdown (figures since the beginning of 2020) although I grant you the FTSE still looks a little poorly:

MSCI World Index* +5.31%
IronBright 30 P -0.57%
IronBright 50 P -3.77%
FTSE All Share -20.65%

(*MSCI World Index is an index designed to track broad global equity-market performance. It is comprised of about 3000 companies from 23 developed countries and 26 emerging markets).

IronBright applies an investment strategy that includes very strict disciplines when it comes to international diversification, employing and accessing a number of fund managers, asset classes and currencies that control overall risk, and it won’t surprise you that we always remain optimistic about the future returns from the market.

We don’t gloss over the world’s problems and we are regularly reminded that the important things in life remain the health and happiness of our family and friends; money remains secondary to this but I hope that you feel reassured that IronBright continues to successfully look after your financial affairs so you free to focus on what is most important to you.


(Apologies that Lockdown Diaries has not been published for the past 2 weeks. We have experienced technical problems, which have now been resolved).

Steve Brady
Director
Steve Brady

Brunel Capital Partners is a sister company of Pilgrim Financial Planning