Coronavirus ii Super 60 update: UK Buffettology fund

interactive investor's analysts bring you an urgent update on this ii Super 60 rated fund.

The coronavirus outbreak and subsequent pandemic have had a significant impact on the global economy and financial markets. Many share and fund prices have fallen sharply in a very short space of time, as has the cost of oil and other commodities.

Volatility has reached levels not seen since the peak of the financial crisis in 2008, and many assets remain prone to sharp movements both up and down.

Given these unprecedented circumstances, with citizens in many of the world’s largest cities confined to their homes, we are collecting updates from managers of funds on the ii Super 60 list of high-conviction active and passive investments. 

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Here is the latest from Keith Ashworth-Lord at the UK Buffettlogy fund. 

"Every bear market has its own catalyst. The Great Financial Crisis of 2007-8 was considered by many of us to have been the most serious financial crisis since the Great Depression of the 1930s. Literally, the system nearly shut down. And would have but for the concerted actions of the G7 in bailing the system out. 

“How does the coronavirus bear market compare? The answer is we simply don’t know. The scary bit is that we have no visibility and no solid foundation for modelling its effects. For example, is it just an event-driven crisis that will pass after a few months or not? What is the risk of contagion from the manufacturing and services sectors to the financial sector? 

“Probably the saving grace is that unlike 2008, the banks are now well capitalised and in a better place. But I feel it will need government intervention to prevent otherwise sound businesses in sectors like hospitality and aviation from going under through no fault of their own. And concerted international effort. This is not economic Darwinism – which is healthy in most recessions – but the danger created by government diktat in closing the economy down to slow the spread of the virus. For that reason if no other, government owes.

“So what comfort can I offer investors who are scared and tempted to run for the hills? I’ve already outlined the importance of staying in the equity market for the long-term. But probably the best I can offer is what Abraham Lincoln said in 1859 quoting a Persian monarch “and this too shall pass”. 

“One day, probably sooner rather than later, this will all be a piece of history in the rear view mirror.”