Market Conditions – 31st March 2020

Since our last update stock markets around the world have rallied more than 10% from their lows, proving once again the old maxim that it’s more about ‘time in the market than timing the market’. Investment conditions do remain extremely volatile and we expect to continue seeing swings each day that would in normal times be headline news.

Last week’s rousing applause for the NHS showed how much this country rightly values those key workers that are saving lives and risking their own fighting this virus on the front line. We are very aware that we don’t work for the NHS or feeding the country, but we are still part of an essential industry, and as such remain open, providing income, advice and long-term strategy for our clients.

As a business, we like many others are now fully adjusted to the ‘new normal’, with a high proportion of staff working from home. Those that must go into the office practise social distancing to stay safe. New processes have been implemented successfully and we are prioritising the safety and security of our clients and staff.

Recent news flows have been dominated by the uncertain length of time the current lockdown arrangements will exist and even the prospect of more draconian social distancing measures. Digging behind the headlines it is clear to see that science, human ingenuity and big budgets can do great things… look at the advances in technology through World War 2 and the US Space Program in the 1960s.

Yesterday it was reported that Mercedes Formula One engineers in conjunction with University College London Hospital have designed and built a device that provides oxygen to the lungs without the need for a ventilator. 40 of these devices have been built and, subject to tests over the next few days, Mercedes expect to be able to produce 1000 of them a day starting next week. Similar progress is being made on ventilator production globally, with the VentilatorChallengeUK consortium and Dyson each receiving orders for more than 10,000 from the UK government alone.

Currently there are 35 vaccines being trialled around the world and combinations of existing approved medicines that have, on small groups, brought time spent hospitalised by CoVid-19 down from 11 to 4 days, effectively more than doubling existing hospital’s capacity. Time will tell their efficacy on whole populations.

Meanwhile, governments around the world continue to stand behind their working populations and provide conditions for most to allow them and their businesses to effectively hit the pause button, ready to hit the ground running when distancing measures are relaxed.

The economic growth numbers for the next few months will be pretty ghastly, the worst since the 1940s, but we expect the downturn to be short-lived. Indeed, most commentators expect it to be followed by a strong recovery. The chart below produced by Vanguard’s own Investment Strategy Group see them predict GDP across the whole Eurozone to return to near pre-crisis levels within 3-6 months of the lockdown ending. We will soon see how accurate their forecast is.

Now is the time that investment companies earn their keep, having to quickly redefine which companies will survive and which will thrive. As one quoted ‘Any losses this year will not determine the value of a company; it is the profits that they can earn in the years to come that count.’ We continue to monitor and challenge the companies we have recommended to ensure that they are doing the right things and following the processes that have made them excel in the past.

Our advice remains consistent don’t let decisions based on short-term market conditions derail long-term plans.

Please do not hesitate to contact us if you wish to discuss this in further detail.

Market Conditions – 12th March 2020

As you will no doubt be aware, global stock markets have endured a very volatile couple of weeks. This has resulted in the majority of portfolios risk rated 4 out of 10 and above dropping by over 10%.

The large scale quarantining in Italy and continued spread of coronavirus elsewhere has raised fears of reduced global demand.  This has been compounded by OPEC failing to agree to a cut in oil production, with Russia refusing to agree and Saudi Arabia responding to this by cutting the oil price, and suggesting they will instead increase production. This is spurring an oil price war that is targeted at getting more marginal producers to close down production, particularly US shale producers. With reduced global demand and threatened increased supply, the oil price fell 30% on Monday morning. 

Whilst the economic impact of the coronavirus will be significant, it is also likely that it will be largely temporary. This is in contrast to the global financial crisis of 2008-2009 which had a lasting economic impact, as consumers had to spend years repairing their balance sheets.

It’s important to note here that it is not the virus that concerns markets. Although estimates of the mortality rate differ from expert-to-expert they are generally around 1% of cases or lower. Of more consequence to investment markets is the disruption to company profits caused by efforts to contain the contagion.

What participants struggle with is knowing how significant the earnings hit from these containment measures will be; unfortunately, we simply can’t know, which leaves the market volatile in the face of uncertainty, although that volatility will be resolved through the passage of time.

It is informative at times like this to look back in time. Wise investors know that investing is a long term commitment. Historically, investors who have been able and willing to ride out the periods of decline in the markets have seen their investments recover and grow. Investing with a long-term outlook and with long term goals is the best way to reduce the impact of stock market fluctuations and see out periods of volatility. The chart below shows that short term volatility is a characteristic of investing, but over the long term the trend is a rising one.

When markets are volatile, it is often tempting to exit the market or switch to cash in an attempt to reduce further expected losses. However, it is impossible to time these movements correctly as no-one has a crystal ball to predict future movements, so being out of the market for just a few days can have a devastating effect on returns.

Using global equities as an example, the chart below shows how missing just a few of the best days can have a big impact on returns. Over the last 25 years, using an example of a £10,000 initial investment, an investor staying in the markets throughout the period could have a potential return of nearly three times greater than that of an investor who missed the best 25 days.

Calling near term market movements in a volatile environment such as this is extremely difficult but with the falls we’ve seen in oil prices, equity markets and bond yields this may prove a constructive entry point for investors.

Overall, the message remains simple, whilst the short-term future remains uncertain, with investment markets at multi year lows, planning for the long term with a level head has never been more important.

Please do not hesitate to contact us if you wish to discuss this in further detail.

Market Update – Coronavirus

Coronavirus: Expect volatility, but don’t panic!

It’s been a month since the Coronavirus first hit the headlines and it continues to unsettle World markets. While there is little doubt that Coronavirus will continue to impact markets over the coming weeks (or longer), medium to long term investors shouldn’t be overly concerned. For most clients the advice would be to change nothing. Trading on news events can often lead to bad outcomes, with panic selling locking in losses and preventing positive returns when markets recover.

Please contact your adviser if you have any queries.

Congratulations to our Mortgage Adviser Ian Chetwynd on meeting the qualification criteria for UK’s Top Rated Financial Adviser

As a mortgage & protection specialist, Ian’s role is to take the stress out of finding a mortgage by doing the hard work for you. Whether you are looking to buy your first home, move up the property ladder, re-mortgage or release some equity, he can advise you on the most suitable mortgage for your needs and will support you throughout the process to ensure everything runs smoothly.

At the heart of our mortgage service is our commitment to providing first class customer care which is why the majority of our work comes from client referrals. If you would like to find out how we can help you, please get in touch to arrange a free, no obligation consultation.

Read Ian’s up to date reviews at:

You are dealing with a Chartered firm

Holding Chartered status means we adhere to an ethical code that underpins broader commitments to professional values. These include putting your interests first, investing in ongoing development of our people’s technical skills and knowledge, and supporting wider initiatives that benefit society as well as the growth of our profession.

You can find more detail on the aims, standards and what makes a firm Chartered online at You can also look up any company and confirm its status using the CII’s Chartered firm search.

HB&O Financial Services assist with charity Shoebox Appeal

Staff at HB&O Financial Services are assisting with Helping Hands’ Christmas Shoebox Appeal 2019.

The appeal is organised by Helping Hands Community Project who are a Leamington Spa based charity helping local people in need. They build relationships with vulnerable people by providing them with both practical and emotional support.

Items that can be included in the shoe box include: toothbrush and toothpaste, soap, deodorant, hats, scarves and gloves, socks, sanitary products, hairbrushes, books, chocolates and sweets.

If you would like to help Helping Hands too, you can make an online donation at: where they will use your donation to make a shoebox on your behalf.

Lucy wins Paraplanner of the Year!

Congratulations to our Financial Planning Analyst, Lucy Talbot on winning Paraplanner of the Year 2019 at the Personal Finance Society awards.

Our Mortgage & Protection Specialist, Ian Chetwynd also made it into the final three nominees for the Mortgage & Protection Specialist of the Year.

Lucy with her award.

The Personal Finance Awards continue to recognise excellence in professional financial planning and journalism. Advisers, paraplanners and dedicated teams of support staff combine to provide clients with the confidence and clarity to help them meet their financial needs and longer-term goals and aspirations. 

Lucy Talbot & Ian Chetwynd

Proud to be Chartered

What Chartered status means from CII group.

HB&O Financial Services is proud to have held the prestigious title ‘Chartered Financial Planners’ awarded by the Chartered Insurance Institute (CII) since 2008.

A Chartered title is a commitment to an overall standard of customer excellence and professionalism. This title is only awarded to firms committed to developing and maintaining the knowledge and capability of their people so they can deliver the highest quality advice.

If you wish to know more about how using a Chartered firm can ensure you receive the most suitable advice, please do not hesitate to contact one of our Chartered Financial Planners on 01926 422292.

HB&O Financial Services shortlisted for Personal Finance awards 2019!

Lucy Talbot, Financial Planning Analyst and Ian Chetwynd, Mortgage & Protection Specialist

Congratulations to our Mortgage & Protection Specialist, Ian Chetwynd who has been shortlisted for the ‘Mortgage & Protection Advice Specialist of the Year’ and our Financial Planning Analyst, Lucy Talbot who has been shortlisted for the ‘Paraplanner of the Year’ Personal Finance awards 2019/20.

Now in their tenth year the Personal Finance Awards continue to recognise excellence in professional financial planning and journalism. Advisers, paraplanners and dedicated teams of support staff combine to provide clients with the confidence and clarity to help them meet their financial needs and longer-term goals and aspirations. 

The winners of each award will be announced at the Personal Finance Awards Dinner at the ICC in Birmingham on 28th November 2019.