Category: News
Client Update #2 Health & Wealth

Since my last update on 2nd March all of our lives have changed beyond recognition in such a short period of time, with serious effects on all of us, but for some, the cruellest of outcomes.


I started writing this update about two weeks ago but stalled as circumstances became more and more uncertain and as the reactions by Governments and Investment markets changed daily.  I have just finished watching the daily update of our Government on 31st March.  One thing I promise not to provide is any more graphs.  I have already seen enough for a lifetime – most showing a simple line rising – meaning the increase of the spread of this challenge and for thousands the deepest sadness imaginable for human lives and families.  Others going down causing disappointment and sadness of a financial nature.

I think we have all learned a new context of worry over this past month.  To put those two contrasting messages in context, I heard a speaker explaining (when comparing the challenge of this virus on the poor of the World to the rich), how it was a privilege to be able to practise ‘social distancing’ and ‘isolate’ ourselves – as we have homes we can go to and close the doors.  How it was a privilege that we can wash our hands – as we have safe hot and cold running water in our homes.  How it was a privilege to enjoy the use of hand sanitizing cream, gel or liquid – as we can afford to buy and use those products.  How it was a privilege to stand in an orderly shop queue – as it showed we were able to buy the food and enjoyed law and order during testing times.

Most of all, how it was a privilege to have our most treasured possession of all – the NHS – where we can all receive the best of care without cost to our family when there are people who can’t access or afford health care.  These comments found me ‘counting my blessings first’, rather than focussing on the current disappointment with my own petty family and work challenges.

Our job involves meeting with hundreds of families over our careers.  I have attended the very happiest and the very saddest events in many families that I have advised.  I have cried with joy as children were born, or clients reached a secure and happy retirement and cried with sadness when they battled with that other horrible ‘C’ word and other life shortening illnesses.

I worry myself sleepless for the financial wellbeing and the advice we give our clients.  However, at the end of this current challenge I expect the damage you now see on paper valuations to eventually be repaired.  It may take a little, or a lot longer than with previous serious events, but it will ultimately repair itself.  Above all we care most that none of you, nor your families fall seriously ill with this virus.


I now turn to the Financial World/Wealth, which we know always comes second to Health, but remains important as it affects our physical and mental wellbeing in the short term.

On paper we have all seen a reduction in the value of almost every investment/pension fund.  There are many clients who have a coping mechanism of not looking from one review to another, and that is fine.  On the other hand, many have asked for us to run a valuation and although they all show a red figure from last valuation to this valuation, almost all have found it to be less painful to see than they first expected.

The 2020s decade has not started kindly by any measure or comparison in my career.  On the other hand, 2019 was a particularly good year for most of our clients with all portfolios showing bright green figures of positive returns – in to double figures in lots of cases.  It is worth remembering 2019 followed a very disappointing Sept-Dec 2018 period which was also a ‘red zone’.  The ‘Ying & Yang’ of finances and investment markets.

I have shared the following statement/explanation with many clients over the years;

“In every five years there will be one or two good years, one or two average years and one or two poor years”.

The problem is we can never predict the order they come in, nor the severity of the poor ones, nor the scale of the good ones.  However, one thing is certain – after every trough, comes another peak, a trough, a peak and so the markets go on.  Our aim is to achieve the ‘target returns’ for you in the long run.  Extraordinary problems are not uncommon.  A look at the years from the ‘ Bubble’ burst in 2000, and even the Twin Towers in Sept 2001 have caused huge turmoil.  However, from experience I always advise not to panic or make any hasty decision to ‘sell in a trough’.

Our advice process starts with a very thorough and repeated ‘Risk Testing’ and ‘Risk Profiling’ of clients.  Many of you will know how tedious this becomes after many years, but it is a crucial part of our job.  The results guide us to advise you on a suitable portfolio which we almost always describe as one to be maintained and held for the medium to long term.

Q: Why do we do this so many times and repeatedly?

A: For exactly times like this, when a pandemic causes severe economic problems.  It remains true that your portfolios will all be widely spread across various economic asset classes and geographical areas, so the returns of one asset class or even one geographical area will never wholly affect your portfolio.

Office & Adviser Support

If you would like to have a valuation sooner than your next scheduled review appointment (which will be via telephone or video-call), please contact our office by telephone on our usual number 01792 720200, or message our office mobile on 07776 688671 which is looked after by our Practice Manager Gina Manton, or call your normal adviser on their mobiles:

Jon Francis – 07973 154335

Paul Williamson – 07885 907011

Ed Lee – 07968 306084

David Gosbee – 07941 468177

As we can no longer meet with you in person we have a lot more time in our diaries for telephone calls or any type of video calls (FaceTime, Skype, Facebook Messenger, Zoom etc. etc).  Other than to open important mail with cheques, all our staff are now working efficiently from home, and all are available 9am-5pm to answer your questions, provide valuations and hopefully reassure you.

Last but not least, for our elderly clients, especially those living alone, we are also here for you even if you just need a chat.  We are paid by you to provide a service.  Don’t ever hesitate to contact us.

Stay at home.  Stay safe.  Help the NHS to save lives.

Jon Francis

Managing Director

WPS Financial Grop

Coronavirus Statement

Coronavirus (Covid-19) Statement for Pension and Investors Clients

Needless to say, we have received a number of questions regarding the affects the fear of Coronavirus is having on investment markets around the World and in particular what do we recommend you do during this time?
I should start by saying this is a new phenomenon in my 29 year career. I have been through two Iraq Wars, countless other conflicts, ‘Biblical’ Hurricanes, Rain and Storms, the Twin Towers, the long running Afghanistan war, on-going global warming, climate change and above all else in my career (from an investment perspective) the “credit crunch of 2007-10”.

Looking back, all of those seem not so important now (from an investor perspective), because the passage of time and economic growth healed the dents made in the short run by long term economic growth and long-term investment growth which we always plan for with our clients. However, I have to concede that these are ‘unchartered waters’ ahead of us all and investors especially, so some things to remember:

  1. When you met us for the first time, and regularly since that time, you would have been asked to fill out a ‘Risk & Return Questionnaire’ (RRQ). Many of you have even joked that you are almost tired of completing the same – but they are vital to us as a guide to the nature of the investor you are and the level of risk you are prepared to take and your capacity to absorb short term loss without panic or loss of too much sleep.
  2. Your RRQ would have been used to complete a Risk & Return Profile (RRP). This profile gave your adviser an indication of the level of risk you were prepared to accept, on a scale of 1 (very cautious) to 10 (Very speculative). Your portfolio would have been created in line with that profile and hence, almost all of you will not be 100% exposed to equity markets. So when you hear the Newsreader making sensational comments about the “Billions being wiped off the FTSE 100 index”, it is not the case that your portfolio will be as affected as someone who has invested all of their funds at a category 10 (100% equity).
  3. Your portfolio will comprise of some investments that may actually go the opposite direction when equities fall as people who jump out of equities look for lower risk alternatives. Your overall portfolio will always have some winners and some losers, but it is widely accepted that 90% of the portfolio performance comes from the “Asset allocation”. That is the nature of the investments that make up your portfolio. For many of you it may be worth going back to your last review analysis and see the ‘dampening effect’ that not having a 100% equity exposure has had on your portfolios. They neither reach the peaks of the FTSE100 or FTSE All-Share index, nor reach the same troughs in the event of a down turn. That will again be true at present.

There are a number of sayings and strategies in Investment Planning and advice. They include:

“It is time you are in the markets, not timing the markets, that determines results”
“Only buy something you’d be perfectly happy to hold if the market shut down for 10 years” Warren Buffett
“We simply attempt to be fearful when others are greedy and greedy when others are fearful” Warren Buffet

So what to do now? There are only essentially three solutions:

  1. Sell as quickly as possible and take the current price that you get and revert to cash.
  2. Hold on through the panic knowing that your portfolio is a balanced one, that is designed to ‘smooth out’ the peaks and troughs that have always been associated with long term investment strategies and know that ALL, (every single one), previous sharp correction/crash/loss on markets because of fear of the ‘unknown’, have on average repaired the losses in around 4 months.
  3. Buy (invest) more now/soon while the price is low and people are panic selling, and enjoy the additional increases from the ‘bounce back’.

I have been candid to tell most of you which I have directly advised, that our Company keeps significant reserves which are invested in areas that are far higher risk than 90% of our investor’s portfolios because we believe that in the long run – 5+ years and longer – they will result in better returns than other lower risk investments. For our Company Investments, and our own personal investments, we will not be selling. We will actually be looking to add more as far as cash flow allows, to eventually enjoy the rebound when the vaccine, or number of infections starts to decline around the World.

One last point worth remembering, in the UK Winter our common colds, and our Influenza cause the serious illness or death of up to 1% of those infected. We do not even think of that as important enough statistic for most to get the standard UK ‘Flu-vaccination’.
To the best of my knowledge, and from the public statistics out there, the Coronavirus has a mortality rate of around 2%. Of those infected 80% will only experience ‘mild symptoms’, so mild they may not even present themselves to medical services. 15% severe symptoms and 5% life threatening symptoms with an overall mortality rate of possibly less than 1.5-2% at the moment. (Source)

Turning back to my investment expectations:

I expect markets to fall further in the short run. This may continue for a while, until a vaccine or cure is mentioned in the World news, or until the number of infections Worldwide starts to reduce – as is already the case in China where this all began. As soon as either of the above occur (vaccine or reduced infections), I expect markets to start to rise again quickly – soon reaching the place they started from and possibly on to further highs as the ‘New Decade Infection’ of Coronavirus recedes back in to History with the rest of Pandemics that have occurred.

We are here to help you make the right decision for you. Contact us at any time between 9am and 6pm.

Jon Francis
Managing Director
WPS Financial Group