COVID 19 – Update and Response from Robson Financial Ltd

Business Continuity

We are aware that our clients will all be experiencing their own concerns in relation to the COVID 19 pandemic and although first and foremost our thoughts are with those already affected we also want to provide information on the steps we are taking to continue to provide a service to our clients throughout this period.

As an FCA regulated business we have always had to maintain a Business Continuity Plan. We are therefore very well placed to deal with the current and any future containment and mitigation measures.

• Our IT and communication systems are cloud based and we have a number of off-site work plans in case the office needs to be temporarily closed or movement of people needs to be restricted.

• Our key staff are being placed on opposite working schedules so as to minimise the chance of staff illness impacting our service to clients.

• We can conduct client meetings and reviews via telephone and internet-based communication for those who are vulnerable, self-isolating or otherwise prefer.

• We have established additional communication protocols with our provider and investment partners, and reviewed their continuity plans thoroughly to ensure minimal impact to our service to clients.

Market Overview

The spread of the new strain of coronavirus and subsequent containment measures have caused significant fear and uncertainty. As a result, markets have reacted severely. While there is undoubtedly plenty to worry about, the current selloff has more to do with the markets inability to keep a grasp on reality than a massive collapse in the global economy.

Global pandemics don’t come along very often, so it is difficult to estimate the impact. And initially a lot of questions relating to the effects will go unanswered, and when that happens the normal response is to just sell.

As the crisis progresses, we should start to see some answers. What the scale of the outbreak is in each country, what the cost to each economy might be, and how effective policies aimed at minimising these costs have been.

In the meantime, we will continue to witness big swings in global stock markets as they behave irrationally in response to new information and events both good and bad.

What is important to note is firstly, the selloff of risk assets that has happened has been indiscriminate. This shows that the reaction is not based on informed reasoning but is fear induced. Secondly the reaction although severe, will also be temporary.

Robson Investment Strategy

Given that the events and fall out will be temporary and that our investment approach is long term, the current market selloff does not alter our strategies. In periods of high volatility, we naturally step up our due diligence and communication processes with our investment partners, mainly looking for changes to underlying fundamentals that may be hidden in the short-term haze.

We also look at our client base to identify any short-term risk categories that might be impacted by a temporary reduction in their capital value and deal with these on a case by case basis.

However, most of the risk management is embedded in our strategies.

Our investment strategies are multi asset which means that there is a mix of investments in each solution. These assets react differently to one another in given market conditions which is designed to help our portfolios outperform the market in general. This diversification is also geographical. It means that the fund managers and discretionary managers can change the position of the portfolios in real time and reduce risk exposure and take opportunities that arise as the situation develops.

This is much more effective in the long term than trying to time the markets. The simple fact is that despite sophisticated and powerful technology, trying to predict when markets will rise and fall is impossible. Trying to time the markets by switching to cash-based investments leaves investors at risk of missing out on the best performing cycles. To avoid this risk, we trust in the long-term value that the fund and discretionary managers can add to client’s returns and continue to monitor this aspect of the investment strategy closely and continually.

This is particularly true of this market correction as the speed of the losses is unprecedented which instils the feeling that the recovery, whenever it arrives, could be equally dramatic.

Having conducted our stress testing we have identified that all of our investment strategies have outperformed their respective peers and benchmarks. Some of our specialist solutions have yet to see any losses although we expect this to change as the crisis deepens. In all cases we anticipate the portfolios will position clients well to take advantage of the recovery.

As always, we are on hand for our clients and invite all client to call us should they have further questions or queries. We will update all with further communications as they become relevant.