March 4th, 2020

Considering the week that we just went through, we thought it would be prudent to provide investors with a bit of commentary.
The month of February saw one of the worst corrections since the financial crisis of 2008: The S&P 500 was down 8% in February, 16% off the highs (intraday) and entered March down 9% on the year. The TSX Composite was down 6% in February and is down 5% thus far in 2020.
We always like to stress that we are not traders but rather investors — a distinction we think is key to long term success. We do however track and closely monitor market momentum, valuations and investor sentiment. In the last two weeks we have seen red across the board. ‘Black Swan’ events such as this are by definition, impossible to predict. Likewise, the future impact that the Coronavirus may or may not have on the economy and the market is nearly impossible to forecast.
"Buy, sell or hold? I think it’s okay to do some buying, because things are cheaper. But there’s no logical argument for spending all your cash, given that we have no idea how negative future events will be. What I would do is figure out how much you’ll want to have invested by the time the bottom is reached – whenever that is – and spend part of it today. Stocks may turn around and head north, and you’ll be glad you bought some. Or they may continue down, in which case you’ll have money left (and hopefully the nerve) to buy more. That’s life for people who accept that they don’t know what the future holds." - Howard Marks
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