Friday, July 30, 2021

Bedokian Portfolio Blog’s Fifth Anniversary (Short) Message

Today marks The Bedokian Portfolio blog’s fifth anniversary. 

It has been more than a year and a half since the COVID-19 outbreak, and we are still seeing second or third waves cropping up in parts of the world. Vaccination is in full swing in most countries as governments want to protect its citizens from the virus and bring back normalcy in daily lives. 


Despite all these happening, we are seeing the rapid recovery of the financial markets; as of 29 July 2021, the S&P 500 had gone up slightly over 90% since its lows back in March 2020. Similarly, the local STI index had gone by about 30% in the same period. Some see it as a divergence which indicated a sort of mismatch between the state of the economy and the markets, which implies a bubble. Others view sectoral/regional play is at work here and capital just flow from one sector/industry/region/country to another.


Whatever it is, we should always go back to the basis of portfolio management, and that is diversification. Regardless of whether tech is facing a slowdown, or a country’s sector is being regulated and facing relegation to a non-profit model, being diversified meant that you are protected from being over-exposed to a certain asset class, region/country, sector/industry, company or events/occurrences.


And this is my fifth anniversary message.


Stay diversified, stay safe.

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