A very happy new year! At this time of the year, fund managers like to do a review of markets in the past year and a forecast or outlook for the coming year. Occasionally, a few would compare – usually when they are right – the market in review versus their initial prediction.
In this first email of 2020, I would like to share our Investment and Solutions’ article, “2019 in Review”. 2019 was a top performing year since the Global Financial Crisis. Not many experts had expected that, either at the beginning or even in the middle of the year!
What about our investment outlook for 2020?
The fact is that it is really hard for anyone, even self-styled experts, to get right the path of markets in any given year. This is because market prices are formed by a complex mix of millions of market participants’ reactions to an equally complex set of drivers which can range from market technicals and technological development to macroeconomics, policy actions, trade wars and actual wars. The possible permutations are so many, yet much of fund management and investment advisory, including those using passive instruments like ETFs, focus on tactical moves in asset allocation or sector and security selection that bet on getting that one out of a million right. This is a stressful way to invest that has not proven to be effective.
Hence, we have no 2020 outlook, just as we had no 2019 outlook. 20/20 vision (pun intended) exists only on hindsight. But the good news is that there is no need to have a crystal ball. There is a better way – staying invested and diversified in the global markets to capture its long-term return, in a way that makes sense for your long-term financial plan.
This is what MoneyOwl will continue to bring to you through its portfolios of Nobel prize-winning funds from Dimensional Fund Advisers in 2020 and our humans-at-core advice. Do a one-time investment top-up of at least $100 by the end of January for a promotional advisory fee of 0.50% p.a. on your portfolio until 30 June 2020 (this will be automatically applied).
Best wishes for a great year ahead!