The corona effect

[TokyoWart]

adamu

Maybe I'm doing something different to you all but my investments are mostly still up over the last 5 years. Only a fund I started buying a few months ago is showing negative returns. I didn't compare net worth to a few months ago though, maybe I'll avoid doing that for a while.

I don't mean to say that my accounts are down compared to several years ago, but when my investments fall by 10% now that's much more than my take home salary each year and of course an even higher multiple of what I can save anew each year. It's correspondingly worse than what happened when I was just starting. I remember the 1987 Black Monday crash because all at once I lost a third of my lifetime savings, but it was just around $1500.

[RetireJapan]

I really feel for those of you who are running businesses that are also affected by the coronavirus panic.

Yeah, it's rough because I wasn't expecting a market crash to come at the same time as a extinction level event for the business. Will have to build this into my plans going forward!

[Wales4rugbyWC23]

Haven't looked at my account yet. Don't think I will care. Plan to continue buying as usual. Doubt we'll remember this in a couple of years' time.

My wife's business is facing an existential threat though due to the school closures (runs a small eikaiwa). That is worrying, and revealed that we are slightly exposed as our investments will be down at the same time we will lose money with the business. Something to think about in the future.

But as for investing, haven't given it much thought -although this is probably this week's blog post

The best thing about your blog is that it is not always about investing, it is also about your additional finance tips such as having an emergency fund, I never though about this till I started following your site and very relevant to the current situation. In addition to the IDECO and NISA doesn't 小規模企業共済 offer a 1% guarantee return annually whatever the stock market performance. By pure chance, I am all in cash in sterling and yen was hoping to buy a house in the UK and it fell through. Hoping to pension up this year in the UK and Japan.

[Bubblegun]

I believe this whole coronavirus threat it way way over blown. As an ex NHS nurse, I think the media are over hyping things to the point of hysteria, looking for every single case, and stat to increase anxiety. And thats what driving the stock markets behaviour..anxiety!
There is nothing economically that says things are bad, so while i dont have a lot of cash to go and buy stocks and shares, I will just continue to drip feed my money into the mutual funds over the next few months and years.
However I am watching the japanese yen v the pound and i have see a huge leap in what I can get and taking the opportunity to buy pounds which go towards my mortgage.

One thing I would be more worried about is if the companies used this virus as a "reason" to make large layoffs, or for the JPN gov to use this as a reason to hike the sales tax again. and everyone just says "shogania"

I do wonder if putting the worlds production in one country, (china) with an unclear, autocratic system, may encourage companies to diversify, where they do production.

[seb]

I was writing end of last year I was getting a hold of my finances in France. I had a bunch of individual stocks that I wanted to sell to replace by a World Market ETF.

I (finally!) got that account enabled a little more than a week ago. I immediately sold Renault (lol) and started buying slowly. The next day the market took 1.5%. I sold everything else at once and will now invest every week, or maybe I'll try to learn to do like deepdishj and put several limit buys.

For the JP side. I finally have some extra money, but I am still building up my emergency fund. Not having one last year cost me about 20,000¥ of credit card fees.

[KyushuWoozy]

Yeah, it's rough because I wasn't expecting a market crash to come at the same time as a extinction level event for the business.

I hear you brother. I've had to cancel both our Spring tours and just about 100% of our non-tour clients have cancelled. With peculiarly horrible timing my first full time staff started work today, so I have to find her salary from zero income ...

[RetireJapan]

I hear you brother. I've had to cancel both our Spring tours and just about 100% of our non-tour clients have cancelled. With peculiarly horrible timing my first full time staff started work today, so I have to find her salary from zero income ...

We were a week away from hiring another teacher, but we will put that off this time. Our fixed costs are over 2m yen a month, so being closed with no income is going to kill the school in 3-4 months. Let's hope it doesn't come to that!

[KyushuWoozy]

That's horrible, it must be weighing terribly on you. Sincerely hope you can find a way through xx

I listened to BBC this morning and it was mentioned that in Scotland Corona has been declared a ' notifiable' disease (whereas in England it hasn't). Apparently this means some Scottish business owners with can claim against insurance for business losses (depending on their specific policy). No idea if policies here provide for this kind of thing.

[RetireJapan]

That's horrible, it must be weighing terribly on you. Sincerely hope you can find a way through xx

Thanks! Fortunately we are diversified (I have a job) and we have savings, so even if we lose the school we'll be fine. Might even enjoy the extra free time

I'm not really stressed at all. This is why we do this money stuff -it provides peace of mind.

[Bubblegun]

I was wondering while the stock market is up and down, how this is able to help those with say and IDECO or a NISA, who are "drip feeding" a monthly sum into their funds.
Many of the funds are not "ACTIVELY managed" due to the lower costs, and I have never bought into the idea that the managers are somehow able to magically predict when a crash will happen and when it'll bounce back. SO i wondered how the funds which passively track, say the S&P 500, are able to help the average investor who drip feeds money in.While the common sense view for me, the average saver, is each monthly contribution is able to buy more for the same amount, I understand that, however how is the fund able to increase its profit, if it is only "tracking" the S&P 500. What did the FUND DO with the shares it previously bought ?Did they just hold them, or did they sell them?


I can see if you have say a whole bunch of loose money and you are able to buy specific stock cheaply this can be a good time to buy, and wait.
But for the average investor who has an IDECO,NISA, and lets say Vanguard have invested in APPLE, and the price goes up, and the price goes down, are they buying and selling the shares actively, I suppose the language of PASSIVE investment and ACTIVE might need a bit more clarification for me in the context of IDECO, and the passive funds and the current situation.
Forgive me if i haven't explained my question well, but it just go me wondering how these funds are operating because they are NOT ACTIVEly MANAGED as they often say. Do they just take our money and buy stock in say APPLE,FACEBOOK, AMAZON and just wait no matter if the price goes up or down, or are they saying, sell because the prices are falling, or buy because the shares are cheaper?
( the reason is we often talk about passive managed funds and actively managed funds) Active seems very easy to understand, but with the more passive funds I just wondered if anyone could say something on that and how the actual day to day running, the nuts and bolts, of the money controlled by the fund managers.

I found this video to be useful but again i wondered if the fund manager actually would buy and sell funds on the same day. EG APPLE goes down 10% so they sell 10% of that company but say SAFEWAYS goes up 10% do they just switch and buy 10% extra of that company.
https://www.which.co.uk/money/investing ... s543x0ss5x

Whatever happens I still believe this is a good time to drip money into my small funds.