Commentary March 2020

COVID-19 UPDATE FOR MARCH

Since my last update the COVID-19 situation has become much more serious and has been officially declared a global pandemic. As I write this (March 13th) the TSX Composite is down almost 24% year to date. We will likely get through this, and 10 years from now we will remember this time, but we will have moved past this. So is this the bottom? I don’t know. Nobody can buy at the bottom and sell at the top (Although I know a few liars who claim they do) 

Is this a buying opportunity? Most likely, I have been cautiously putting money to work in this market. Ben Graham, who was Warren Buffett’s mentor used an analogy called “Mr. Market.” Mr. Market is a volatile business partner that offers buy or sell your business interests on a daily basis. Most of the time he is reasonably sensible, but on occasion he gets a little excited. When he is feeling euphoric he will pay exceptionally high prices, and when he is despondent he will beg you to buy him out at low prices. Most of the time you should completely ignore him and do your best to not get caught up in his excitement. 

What I will say regarding the current situation is that Mr. Market is worried about the next year or two right now. In the next 5 to 10 years he will be excited about something else. 

I encourage you to reach out if you have any questions or concerns. I’m also available on my cell phone after hours at 306-241-7690. 

As always I am available for any questions, financial or otherwise, at 306-385-6261 or by email msmithwindsor@iagto.ca