Don’t touch your face… or your shares

20 March 2020

reading time:  minutes

Earlier this week I recorded the following video, sharing some perspective in relation to COVID-19 and everything that is going on at the moment.

I also sent an email to everyone who has engaged Fairhaven Wealth. It's the first time I've felt compelled to do this. Below is a slightly modified version of the email I sent to my (wonderful) clients. 


I hope this email finds you well.

I’m sending this email because share markets around the world are very volatile at the moment.

If this is causing you concern, I understand. It’s normal to feel a bit anxious during times of uncertainty.

This is a generic email which I’m sending to all past and present clients of Fairhaven Wealth. (Apologies for not making it more personalised.)

In the coming days/weeks/months, please keep the following in mind:

  • Remember that the most important things in life aren’t about money. In particular, your health is your wealth. Do what you can to stay well, and to try not to spread COVID-19 to people who are more vulnerable than you. Keep Calm and Wash your Hands – and try not to touch your face.
  • From an investment perspective, the most important thing is to ensure you’re invested in a way that is appropriate to YOU. Your personal circumstances, needs, and objectives should be central to your investment decisions, and they should take absolute priority over any short-term movements in financial markets. Play the long game.
  • I’ve mentioned that you shouldn’t touch your face. Assuming that you’re invested appropriately in the first place, you also shouldn’t touch your shares, or make any radical changes to your investment approach. The key exceptions are:
  • If your circumstances, needs, and objectives are likely to change substantially, as a direct result of what is going on at the moment. (For some people, this may very well be the case.)
  • If you’re feeling a lot more anxious about what is going on than you expected. This might reveal that you have a lower tolerance for risk than you thought. This might inform how you should invest – not just now, but into the future.
  • If part of your plan is to slowly transition from one investment approach to another – for example, by making monthly payments from one type of fund to another. Continue with this strategy.
  • If you’re invested in shares or other growth-oriented assets, these investments should represent funds that you won’t need to access for years – if not decades – into the future. In all probability, by the time you need to access them they’ll have recovered and grown further.
  • If you think you can time the market by selling out before the market goes worse, remember that you have to be right twice. You can’t just sell out of the market: you also need to buy back in at a suitable time. Ideally, you will buy back in when the market is at its lowest. However, unless you have a crystal ball you can’t know for sure when the market is at its lowest – and at that point, confidence tends to be low, and you’ll probably be wondering whether you’re catching a falling knife. Maybe you’ll get the timing right both times. It’s just as likely that you’ll end up waiting until the market has recovered, and ending up in a worse position than if you’d done nothing.
  • No one has a crystal ball. Every big event has second-, third-, and n-th order effects that interact with each other. This interrelationships are incredibly complicated and it’s impossible to know what will happen for sure. There will, however, be people who will talk as if they know what will happen. The media likes to showcase these people because human beings crave certainty. Take any prognostications, including my own, with a grain of salt.
  • In direct contradiction to my comment above (so remember: take with a grain of salt), it’s worth noting that COVID-19 is not an existential threat to the human race, and it’s likely that the major threat will be over in a couple of years at the most. There may be an impact on supply chains in the meantime, and the impact of these are hard to predict, but this is unlikely to profoundly reshape the economy. For most people, life as we know it is likely to go on over the medium- to long-run.
  • This may sound callous, but some of the second-, third-, and n-th order effects will be positive. There will be opportunities for individuals and organisations. Many large companies (in which you’re invested) are positioned to take advantage of these sorts of opportunities. In many cases they’ll even have strategic plans for moments like this.
  • A number of active fund managers have been saying in recent years that they’ll perform better than index-based funds during downturns. This isn’t supported by the evidence I’ve seen. The same dynamics that make index-based funds a good approach during bull markets make them a good approach during bear markets. Again, the key isn’t to beat the market. The key is to not be beaten by the market, and to save unnecessary fees, while being widely diversified. Index funds represent the consensus views of all of those active managers, in good times and bad times. Just watch.

If you want to read some more of my thoughts on COVID-19 specifically, I’ve written a couple of recent articles: “COVID-19: an exercise in managing risk” (I recommend reading this first) and “The black magic of compound growth, and assorted thoughts on COVID-19”.

While I’m sending a mass email I’ll mention a few extra things:

  • If you’re not subscribed to my mailing list, I recommend subscribing. I send a monthly newsletter including links to the most recent articles on the NZ Wealth & Risk blog, along with extra news – such as new services/offerings, plus candid comments I’d rather not publish widely.
  • I’d love to hear how you’re going. Feel free to call or email. I won’t charge (or bite) for a quick catch up. If you want to schedule a time to chat you can do so here.

Thanks for your time. If I don’t hear from you in the near future, I hope you and your families are well (and stay well), and I wish you all the best.


Sonnie Bailey

LLB BCom MEntr DipFincPlan AFA | 021 0269 2213 | 03 421 5764 | 145 Clyde Road, Christchurch 8053 |

We help you plan to meet your financial and lifestyle goals and manage your risks. We advise on investments, KiwiSaver, insurance, and more. Our services are flat fee, advice-only, and fiercely independent.

A disclosure statement is available on request and is free of charge. If you’re not the intended recipient please delete the message and notify the sender.


coronavirus, COVID-19, Fairhaven Wealth, investing, uncertainty

About the author 

Sonnie Bailey

Sonnie provides financial planning services via his business, Fairhaven Wealth ( Fairhaven Wealth provides independent, advice-only, fixed-fee financial planning services. Sonnie is also a “recovering lawyer”: he has specialised in financial services, trusts, and estate planning.

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