March Comment


We look back on the first quarter of 2016 and ask ‘Where to now?’

March Comment

There is a great chart that illustrates the follies of trying to time the market.  The S&P has made about 9% p.a over the past 25 years.  If you miss the best 10 trading days that return is 6%, if you miss the best 40 days it is 0% and if you miss the best 60 it is negative 4%.  That is because the best days come right after the worst ones.  As we have seen so far this year, what is true over time is just as true over a month and a quarter.

As long-term investors it is much more important to be sure that we have invested in the right companies over time and if possible to have capital to take advantage of dislocations like we just had.  Our biggest risk is that the companies themselves are disrupted, by competition, innovation or other means.  We urge you to read Giles Tulloch’s insight piece for this month Is Rent Money Still Dead Money? about how the next generations are moving from owning to renting assets in almost all aspects of their lives and the implications this will have for our economy and our investments.

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