Right Here and Right NowSubmitted by RetireWiseCFP on July 20th, 2020
Right Here, we are deluged with more and more data about people getting COVID-19. We read about states reintroducing shutdowns. It seems all is getting worse. Do you know, Right Now, there are over 400 (yes, 400) potential treatment options and 150 vaccines in development?
Where are we now?
Amidst all the COVID-19 mayhem, the market managed to stage a huge comeback. I wrote in my last letter that I fundamentally believed we would experience a comeback, and we should be disciplined and not panic. But we will lose the rebound we’ve gained if we as Americans do not ACT differently. Everyone must take personal responsibility to ACT differently. Folks, that is the end of my public service announcement, but it is very seriously the core of my performance message. The X-factor for your portfolio performance—for the rest of 2020, 2021, and until a vaccine is introduced—is how each of us behaves to control the spread of the virus. If it gets out of control a 2nd time because of collective irresponsibility, we are going to have a BIG problem.
Where do we go from here?
Our investment philosophy is battle-tested, true, and has delivered for clients. Why? It is our all-weather quality portfolio for which I systematically buy new secular growth opportunities to join the portfolio. What do I mean exactly by secular growth opportunities? I think I owe you more explanation of this subject in coming letters. Let me start by saying that secular growth opportunities are generally companies that are fewer than five years old, whose revenue growth is NOT tied to what the stock market is doing every quarter. They have a long runway; and when we are right, we should experience 100% and more in expected returns.
On fixed income and alternatives:
The song Wind Beneath My Wings captures exactly what The Federal Reserve Bank has been to the stock market and economy since this crisis began: “…It might have appeared to go unnoticed. I want you to know I know the truth. I would be nothing without you… I could fly higher than an eagle. For you are the wind beneath my wings.”
What should we look out for?
Previously, (specifically, my October 2019 letter), I provided you with advance warning that the 2020 election is coming, and things are probably going to be said and done that have never been said or done before. Please, let me share again: PLEASE BE CALM. PLEASE DO NOT REACT. PLEASE DO NOT CALL ME TO ASK IF I AM GOING TO BE SELLING STOCKS BECAUSE SOMEONE SAID THIS OR THAT AND THE MEDIA IS FOAMING AT THE MOUTH. Remember—the media want you to react, they want you to come back and watch again tomorrow. I, Femi Shote, I approve this message: Fear not, America will endure, survive, and thrive after November 3rd.
Right Here and Right Now, each one of us has an opportunity to be a real hero, a real lifesaver. Our ACTION of personal responsibility, not philosophy or politics or whatever other -ism, is what the country needs now. We each must make sure we do not spread COVID-19 to anyone else. Period! We give science the time and space to catch up (remember as of July 1, 2020, there are over 400 different treatment possibilities) and help other individuals, our society, and the world. Here each one of us is indeed a difference-maker.
Femi T. Shote, MSF, ChFC, CFP®
Accredited Investment Fiduciary®