Managed Portfolio Quarterly

Q1 2020 Commentary

As I contemplate what to communicate today, I am struck by the sheer severity and breadth of how much the world has changed in such a short time.  In a period of a few months, the world has succumbed to Covid-19, and seemingly every facet of life has been impacted.  To date, more than 850k have contracted the disease and the WHO estimates a 3.4% mortality rate as of Mar 3 (Worldometer, 2020, para2). Although China has reported encouraging data that reflects a decrease in newly suspected cases, other countries such as the USA are still seeing growth in the number of cases. No country will be able to escape the impact of this virus, and hopefully within a few months, we will be able to resume normal activity.

From an economic and market perspective, I would expect that countries around the world will experience lower GDP at lease until June, resulting in a technical recession for Q1 and Q2. From a market perspective, I believe the current fiscal and monetary policies being applied worldwide will promote a stronger third and fourth quarter. Hopefully by then, a vaccine will be created and eradicate this pandemic once and for all.

Of course, the big question to consider is how to react to this “black-swan” event that was completely unpredictable?  I won’t stray from my process, and have more to win by maintaining a disciplined proven strategy rather than making emotional panic driven decisions.

Stay safe and take time to appreciate your health, homes, and families.

Should you have any questions regarding the above, please contact my office at (403) 945-8237.

Bryan Muir