Certus Market Update 25 March 2020

NZ TAKING POSITIVE STEPS IN FIGHTING COVID-19

As you will know the New Zealand Government has moved NZ into “Level 3 Restrict” Alert category of the Covid-19 situation moving to “Stage 4 Eliminate” tonight.

The Global Covid-19 situation has significantly escalated over the last 3 weeks with Europe, US and UK being struggling to contain the outbreak. I personally think the NZ Government’s response by moving into Level 4 Eliminate is a positive step in trying to restrict and eliminate this Covid-19 disease.

TRY TO KEEP CALM AND BE PATIENT

The financial markets including the NZ Share market has been very volatile over the last 2 weeks due to the escalating situation. The Covid-19 outbreak has been a very unpredictable and rapidly moving situation.

I can understand clients being nervous and concerned about the capital value of their investment portfolio’s dropping since February 2020. Please try to keep calm, be patient and review your investment portfolio each week or month rather than looking at it daily.

Certus Financial Group really appreciate clients’ patience and understanding during these difficult times.

I have included some graphical information of the Global Share (S & P 500) market crashes of more than 10% and the significant recovery afterwards.

After each Global Share market correction there has been a strong recovery after 12 month and 36 month periods.

I have also included a more “optimistic” investment update from Greg Fleming, AMP Capital Head of Investment Strategy titled “Value rapidly building in Markets?”

AMP Capital Income Generator and Harbour Income Fund Update

The AMP Capital & Harbour Income Funds will continue to make income distributions
The AMP and Harbour managed funds are professionally managed by experienced Portfolio Managers

The capital value (unit price) can move up and down, however this doesn’t affect the income payment
Both the AMP & Harbour Income funds have some Cash holding in which the fund managers will purchase good value assets/securities in the current market
These funds hold a majority of quality Local Government Corporate Bonds, NZ Bank Bonds, high Dividend NZ shares (Spark, Fisher & Paykel Healthcare, Genesis Energy, Goodman Property Trust, Contact, Infratil), smaller holdings in Global Property and Global Infrastructure

Please see the AMP Capital Income Generator Fund and Harbour Income Fund information, top ten holdings as at December 2019 (AMP Income Generator) and February 2020 (Harbour Income Fund:

AMP Income Generator Fund: