Investment Lessons from the Pandemic

glass globe business. Global MarketExcerpted with permission from “5 Investment Lessons from the Pandemic” by Steve Watson, Equity Portfolio Manager at Capital Group. 

As a 30-year investing professional, the past 16 months stand out in my career as both intensely painful and incredibly instructive.  What has this most unusual time in history taught me?

  • Market crises are inevitable. The pandemic-driven stock market crisis led me to think of past market traumas I experienced. I counted 21, including the collapse of the Soviet Union, the bursting of the technology bubble, the global financial crisis, and now COVID-19. This list highlights the reality that market disruptions are a fact of life for investors. My list suggests we get one of these events every 18 months or so.
  • History doesn’t necessarily repeat itself in ways you might expect. For instance, I lived in Hong Kong through the dark days of the SARS (Severe Acute Respiratory Syndrome) epidemic in 2003. When COVID hit, I was quick to make comparisons between the two. Yet, while SARS was frightening to live through, relatively speaking, it was a fairly minor event. Drawing false conclusions about COVID based on the SARS experience left many investors unprepared for the extent and duration of this pandemic.
  • Diversification holds strong. While “growth” and “value” investment labels are overly broad, I’ll use them to make a point. I lean toward value, but I also have long-term growth-oriented investments. Many are tech-related (semiconductors, e-commerce, etc.) and I like to purchase shares when they’re down and out; I also hang on long enough to let the market catch up with what I think is the true value of the company. In hindsight, my selection of growth-oriented tech stocks saved my skin during the worst days of 2020.

Click here for a PDF of Watson’s full article. Investing Lessons Learned from the Pandemic

By |2021-08-16T13:03:34-07:00August 23rd, 2021|Current Affairs, Investing|

Major Economies Bouncing Back

Effective vaccines, record government support, and pent-up demand are fueling a historic turnaround for the global economy. Data shows major economies bouncing back. In June, the International Monetary Fund more than doubled its 2021 U.S. GDP estimate to 6.4 percent. The National Retail Federation (NRF) also revised its forecast, anticipating retail sales growth between 10.5 percent and 13.5 percent. NRF’s initial projection for 2021 was 6.5 percent.

“The economy and consumer spending have proven to be much more resilient than expected,” said NRF President Matthew Shay. “While there are still risks related to worker shortages, tax increases and over-regulation, households are healthier overall and consumers are demonstrating their ability and willingness to spend.”

Major Economies Bouncing Back

Major Economies Bouncing Back

By |2021-07-15T09:58:23-07:00July 15th, 2021|Current Affairs|

Cyber Security Checkup

Curkendoll-WEBCyber attacks on government agencies and major companies around the world are on the rise. In the past several months, ransomware attacks have breached networks for Microsoft, the Irish Department of Health, U.S. Colonial Pipeline, and JBS meat processing in North America and Australia, to name just a few. After hearing such news, the idea of protecting your personal data can seem overwhelming or futile. Yet, conducting a cyber security checkup — quick a review and update of your accounts and electronic devices — can help more than you might think.

Following are some steps you can take to simplify and maintain cyber security efforts. Each only takes a few minutes to complete. It’s a worthy investment of your time. Block 15 to 20 minutes in your calendar this week to conduct a cyber security checkup.

Use antivirus software, and keep apps and software current.

Make sure you have trustworthy antivirus software installed and updated to protect your computers and mobile devices from viruses and malware. Keep software up to date with the latest patches and upgrades. Sign up for automatic updates.

Close or delete unused accounts.

The smaller your online presence, the more secure your information. Take a few minutes to close unused accounts and minimize your vulnerability. Sign up for account activity notifications to help you keep track.

Use multi-factor authentication.

Also called two-factor authentication, this requires a second credential to verify your identity. (e.g. It may require entering a code sent in real-time by text, email or phone call.)

Use screen locks on every device.

Set a password or PIN for every laptop, smartphone and tablet you own. Any lost device without a screen lock is a gateway for someone to access your email, banking and social accounts; thieves can change passwords and take control of your digital life.

Check your data-breach status.

A data-breach, or being pwned (pronounced pōned), means your personal data has been stolen and possibly sold. At, you can check your email addresses against lists from 120 known company breaches (i.e. Adobe, LinkedIn, Facebook, Daily Quiz). Be sure to change the password for any compromised accounts, as well as any other sites where you used the same password.

Beware of Phishing

Phishing is a malicious text or email that seems to be from a trusted source. The object is to trick you into clicking on a dangerous link or providing confidential information. Common warning signs include:

  • A message you didn’t expect or that comes from a person or service you don’t know.
  • Spelling errors or poor grammar.
  • Strange or mismatched sender addresses.
  • Mismatched links (a seemingly legitimate link sends you to an unexpected address).
  • Odd links or addresses.
  • Requests for passwords, account numbers, personal information or answers to  security questions.
  • Offers that seem too good to be true, or messages that express great urgency.
By |2021-06-11T16:34:54-07:00June 15th, 2021|Current Affairs, Cyber Security|

Cryptocurrency Risk

Mailiard-v1-WEBThe latest investment fad has arrived: cryptocurrencies. Younger, inexperienced buyers excitedly trade “cryptos” on their phones and brag about it to friends. One claims to be getting rich buying Bitcoin (the original cryptocurrency). FOMO kicks in (fear of missing out) and entices others to buy. Unfortunately, it’s rare that any fully understand what they’re doing or cryptocurrency risk.

As legendary investor Warren Buffett said, “I can say almost with certainty (it) will come to a bad ending.”

Cryptocurrency’s wide appeal is easy to understand. It’s basically digital cash that can be transferred immediately and anonymously between parties. Bitcoin trades using technology called “blockchain,” a digital ledger that is purported to be unhackable. This unique currency also isn’t bogged down by intermediaries, such as governments, banks or international currency exchanges.

Potential appeal aside, crypto trading should not be considered as investing, but rather speculation. Only those with giant appetites for risk should consider it. Stories of wild price swings abound. When the economy appeared to be collapsing due to the Coronavirus, Bitcoin fell about 65 percent – three times as much as stocks – by March 2020.

“Bitcoin is not real money now, and… without huge reforms it will never qualify as real money,” said Larry Kudlow, a noted economist formerly of CNBC and the Trump administration.

One should only risk money in cryptocurrency markets that he or she can afford to lose entirely. How many people really have “money to burn?”

In addition, the tax implications of cryptocurrency are extremely complex and shouldn’t be taken lightly.

Real, long-term investing is the time-proven path we take at Perspective. We work with our clients to first develop a written plan, a road map.  From there, we build and maintain broadly-diversified portfolios in established markets backed by many decades of risk-and-return data. The result is a less volatile and more predictable portfolio.

By |2021-05-11T19:51:30-07:00May 17th, 2021|Current Affairs, Investing|

Learning to Live with Uncertainty

Eng-WEBA good friend and client of mine used to live in Somalia. She recently shared a great story with me about a trip she took years ago with her baby daughter. It’s a fabulous lesson about learning to live with uncertainty.

They had boarded a flight in Somalia, and all the seats were already taken. Many more passengers were standing in the aisle. They were instructed to deplane and line up on the tarmac. Then, they were told the seats would be decided by a foot race.

Passengers had to run, and those who did not run fast enough were not allowed back on the plane. My client ran the race with her daughter on her back!

We all live with uncertainty. Every day, things happen that are beyond our control. This story illustrates one of the more extreme situations that most of us will never have to experience. In the United States, we have grown accustomed to getting a seat on the airplane if we book a flight. We generally have a car available to us if we reserve a rental. We enjoy a high degree of certainty that the meal we order at a restaurant will arrive the way we like it.

All this suits me. I’m a person who loves structure and routine. Learning to live with uncertainty isn’t something that comes naturally to me.

Yet, out of necessity, I have learned to embrace change and develop the ability to adapt. It’s inherent in the career I chose. Dealing with financial markets, as well as an ever-changing economic and political landscape, has forced me to learn to live with uncertainty.

Experience is a great teacher. The more experiences we have in life, the more comfortable we can become with uncertainty.

My friend has lived through many of the ups and downs of life and the financial markets. As a client of 20 years, she has adapted well, and it has been rewarding for her and her family. Just like when she adapted to that situation in Somalia and was awarded a seat on the airplane.


By |2021-04-15T11:49:07-07:00April 19th, 2021|Client Stories, Current Affairs, Financial Planning|