by Ted Richards Click to listen to the latest episode of The Richards Report with Pat Garrett.
It was only five weeks ago that Pat and I recorded our last podcast episode together, but in these times of isolation a week feels like a month and a month feels like a year, so I thought that we were probably due to revisit discussions about investing in the time of COVID-19.
We did a call-out to listeners on social media to send in the questions they would like us to discuss and I’m grateful to all the people that sent in questions. A lot of the questions were related to our thoughts on the market right now. More specifically, people wanted to know whether or not now is a good time to invest, and if there will be any single piece of data that could help answer this question.
We discuss both of these questions in more detail in the podcast episode, but the reality is trying to time the market is incredibly hard (if not impossible) to do. Only with the benefit of hindsight do we ever know when the market has bottomed. As a result, we think it’s far more prudent to focus on time in the market than trying to time the market.
Furthermore, while the market isn’t always rational, it does constantly price in new information. This means that often by the time there’s been an event or there’s more clarity that a risk is reduced, it’s already been factored into market prices.
Other topics we discuss in this episode:
- What you might typically find in a conservative portfolio containing ‘defensive’ asset classes
- If a similar virus emerged at some point in the not-too-distant future would it be classified as a black swan event?
- Why can there be such a disconnect between some of the daily events reported in the news and the share market responding in the opposite way (e.g. the share market going up at times when confirmed positive tests hit all-time highs)
- Industry super funds versus retail super funds
- The great story behind the Six Park name