Investment Thoughts

We start the New Year with both optimism and trepidation. Optimism that eventually the vaccines will allow a return to normality, sooner rather than later, and that the Brexit deal will settle down into a viable one for Business. Trepidation that further complications may arise with COVID-19 and that firms will run out of money before they can reopen or that new ways of working under the Brexit trade deal damage their business.

The implications of this, I believe, are that we will continue to see some market volatility over the course of 2021, hopefully, settling down after that. Income for the foreseeable future remains a challenge, although, we are encouraged by the rate at which some companies are reinstating their dividends.

In portfolio terms, we were right not to run from the UK Stock market during the summer as it had one of the strongest recovery’s globally at the end of the year. Looking forward, however, it is clear that a more global investment approach has really ‘come of age’ over the last year.

We are starting to see a real and consistent outperformance by companies with good (ESG) environmental, social & governance track records, so this will feature across our advice going forward.

We will continue to take a long-term view on portfolios and, considering the above sentiment, focus on companies with good financials and a sound business model for the world we find ourselves in. At the same time, being cautious of those opportunities that are too good to be true, of which there are always many.