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Salad Days

“My salad days when I was green in judgement, cold in blood. To say as I said then!” Cleopatra, Act One, Anthony & Cleopatra, William Shakespeare.
Salad Days

Reflection, and the accompanying self-awareness, are not accorded the same status as innovation, speed of thought or “first mover advantage”. The acronym FOMO speaks directly to JDI (Nike’s slogan since 1988 “Just Do it”) and, as we consider an end to Pandemic life, there is a growing air of expectancy akin to sprinters at a starting line.

Since March2020, FOMO was writ large over equity markets globally. More than anything, apart from UK house prices perhaps, equity indices reacted on this basis. Axiomatically, equity prices look forward, attempting to capture what will be as much as what is. By and large in the last 12 months, they have reflected a combination of optimism that “things are not that bad” and a fear of missing out should that be the case.

Reality is always different. “It is better to travel than arrive” is the bedfellow of FOMO. We ride the wave with little intention of seeing it reach the beach. It is clear from recent weeks at least, that there has been a growing trend to “take profits”, particularly in the UK equity market.

Is this an example of investors reflecting on the “salad days” of 2020 when judgement was green? We believe that clearer heads will prevail and that normality in behaviour and judgement will emerge.

This clarity is likely to focus on the new. Regardless of the debates around the World about COVID and our emergence from it, there can be little argument that the World has changed. The impact on demographics and consumer behaviour appears secular. Investors taking profits in current equity markets are faced with this landscape and a dearth of compensating alternatives in a low interest rate environment.

VIVA Investment Partners believes that the focus of investors looking to 2022 and beyond will encompass allocations to more private and, arguably, more risk-orientated asset classes. This will include early-stage companies whose concepts and economics have been tested in the crucible of the Pandemic. We are developing relationships, forming alliances, and building our business on this basis.

We can all reflect on our “salad days” and, like Cleopatra, regret. We prefer to reflect on a year of hard knocks and successes hard won, wiser for both and committed to working hard again.

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