Coronavirus. These are tough days

Lately I’ve been thinking a lot of my family in north Italy, Germany, Iran and the US – all countries heavily affected by the coronavirus –  and also of my friends scattered in many European countries and beyond.

The virus is omnipresent – empty supermarket shelves give birth to an urge to shop more than we’d need, the news and the stock market are relentless bearers of news of crisis, people around us are nervous and the roads empty.

People are worried about loved ones and friends, and rightly so. I feel the same.

But the one thing that will not make any of this better is panicking – panic will not keep you safe nor healthy, on the contrary it will only make your mental health worse. I know it’s easier said than done, but do your best to focus on what you can control.

Personal finance update

I’ve lost a lot of money, and who hasn’t?

As mentioned in a previous post, I’ve been wanting to buy some Google shares for a while. I work in the digital marketing industry and know that Google Ads will always be in demand. So I did.

Long story short, I could have bought it (so far) $350 cheaper!

My Stocks & Shares ISA is a deep, deep red…

My pension was a bit of an unwilling gamble. Days before the market first tumbled at the end of February I requested for it to be transferred to the SIPP pension at Vanguard. It had been made available in the UK a couple of days prior.

I thought I might have managed to sell high end of February and bought lower in March, but I wasn’t sure, I had to wait. 

My hopes were misplaces. In those 3 weeks I lost 14% of my pension too.

… and breathe…

Coping with a bear market

DO NOT sell in panic. That is a perfect recipe to lose even more money.

DO:

1. Keep hold of your cash. In case you lose your job or have a reduced salary for a few months, as Tanja Hester of Our Next Life explains. That is a real possibility, even more than during the 2008 market crash and subsequent recession.
2. Stay the course and follow JL Collins’ advice. As he explains in his recent interview by the Mad FIentist, if this is your first bear market you first need to learn what kind of investor you are and what your sentiment is during a bear market. If you have lived through a recession before as an investor, also stay the course.
3. Rebalance your portfolio following the advice of Millennial Revolution. They also have a unique take on the global economy based on their knowledge of Asia.
4. Buy more ‘on sale’ only if you can really afford to part with that cash.

Companies & industries doing well

When someone loses, someone else gains. Here are some (unplanned?) winners:

• Drones: Spain is in lockdown and police are using drones to check people are not infringing the rules. This will do wonders for the drones industry.
• Supermarkets: people are stockpiling food, which brings in revenue especially for supermarket chains. On top of that, the British government will help retailers with business rate holidays, which Sainsbury’s announced would be saving them £500m!
• Amazon: from online deliveries to films, a few days ago Amazon announced it intends to hire 100,000 additional staff to cope with demand.
• Spotify, Netflix, online courses: you’ve got to spend your time at home wisely
• Super fast internet providers: people are upgrading to faster internet as they are spending a lot more time at home
• Garden furniture and supplies: we bought a garden bouncer for our lockdown period so that our daughter (and us!) can excercise in the garden. Even in lockdown we are allowed to stay in our private gardens, so also garden furniture, plants and seeds and, of course, bird feed for cheap and guilt-free entertainment.
• Indoor sporting equipment: from dumbbells to indoor cycling equipment, and from exercise machines to darts… Decathlon reacted quickly.

If you lost your job, the companies above are / are likely to be hiring.

A positive end note

Nothing is only bad. So let’s end this post with a positive note.

Venice, like the rest of Italy, is in lockdown. For the last two weeks motor boats have not been transporting tourists, goods nor commuters, with the side effect that now the water in its canals is clear, fish are visible and swans have come back! #venicecanals

The environment is benefiting from less travel.

Take care and stay positive.