APRIL 13 - 17 MIDWEEK UPDATE
April 15, 2020 - Over the last two weeks, HighGround team members have chosen an attitude of gratitude. We challenged one another to jot down one thing we are grateful for each day.
We acknowledge the hardships, sickness, and sorrow people are experiencing globally and grieve with those who grieve. Our gratefulness challenge is not an exercise in turning a blind eye to pain but in fixing our eyes on hope, beauty, and truth even during a time of great suffering.
As we seek to recognize the goodness around us, the HighGround team is especially thankful for you, our clients. We are proud to champion the important work you do and are humbled to be your trusted partner in pursuit of your mission.
- Equity markets have recovered in recent weeks off late-March lows but are expected to remain volatile as first-quarter economic and corporate earnings data begin to reveal the financial impact of COVID-19.
- Investors remain cautiously optimistic as federal and state officials’ conversations shift from virus containment and social distancing to plans for reopening parts of the country.
- OPEC and all oil-producing allies finalized an agreement to cut production by 20 million barrels per day — the single largest output cut in history.
- Despite the record size of the cut, there is still a sizeable surplus expected over the second quarter due to COVID-19 travel restrictions, which will cause continued downward pressure on oil prices in the short-term.
- Per the U.S. Energy Information Administration (EIA), excess crude oil inventory is expected to build to 3.9 million barrels per day in 2020 — this will more than double the previous record in 1998 of 1.8 million barrels per day.
Stay The Course: Remain Disciplined
A disciplined investment process requires effective strategy development, implementation, and oversight. But what does it mean to stay disciplined?
- Being disciplined doesn’t mean sitting still. Managing a portfolio never stops. Once your portfolio is invested, HighGround monitors your strategy to ensure it adheres to policy guidelines, including oversight of investment managers, rebalancing portfolios, risk management, and performance reporting.
- Being disciplined means maintaining a portfolio through all market conditions, even unfavorable ones. At HighGround, we are driven by asset allocation, diversification, fund management (active and/or passive) and investment discipline, not the markets or short-term considerations. We believe the best advice and course of action in challenging markets is to stay the course unless your circumstances or objectives change.
We remain committed to keeping you informed with timely communication during this challenging market environment. We are here to support your mission. Thank you for your ongoing trust.