Surviving A Rip Current: Do Not Panic

I agree that the escalation of trade wars spilling over into the currency markets is not ideal, while the gravity of global and local political polarisation doesn't offer much hope for compromise.

Negative rates on more than $13trn worth of bonds does not bode well and blurs the lens through which one values equities. 

However, there is nothing original that I can write on such herculean subjects that has not already been said and digested several times over in recent days.

What I can say with honesty, however, is that we will get pushed around by these markets like a lot of other market participants. 

We will undoubtedly feel bruised as our prices get caught up in the market maelstrom.  

MitonOptimal's Sullivan ups UK REIT exposure for 'incredible value on offer'

Cheap markets will be impacted negatively by current events. Good quality companies and sectors will suffer.  The market will show little consideration for fundamentals. 

Short-term equity momentum is often powerful, displaying the characteristics of a rip current. One is best not to try and swim against it in fear of exhaustion and death.  

Someone somewhere once spoke of 'known knowns'. Well, nothing that has triggered the events of the past few days was new material. It has been hiding in plain sight. 

There is always a danger that when significant market moves come in to play, emotion takes over and one's fears are heightened, further accelerating the issue.   

Selling into a correction is unlikely to trigger exhaustion or death, but it can be a rather painful experience to chase the market down.

We are not sure the facts have changed enough for us to change direction. We were comfortable with our portfolio last week, and remain even more comfortable with it today with markets 6% cheaper.

Our only regret, perhaps, is having duration of two years, and not ten on our fixed income book.

The solace we have is that our investment process is robust and performs the role of a lighthouse; it does not dictate our direction of travel, but it does guide us, and help us from straying too close to the rocks.