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Market Drop & Avion’s Coronavirus Business Continuity Plan

By Paul J. Carroll, CFP®March 9, 2020December 1st, 2023Videos

Good morning. What a Monday! The market is down 7%. Oil prices have collapsed to $34, and Goldman’s actually afraid it’ll hit $20. We have Coronavirus. We’re going to talk today about all these. Most important – what’s our strategy to protect our clients from these fires? We have two kinds of clients who are reacting to what is essentially a real capitulation within the market. We’ve got the scared clients, and to them I would say we plan for this. This is why we’ve been so conservative. No one knew when a market correction would come, but we knew for over 18 months that the markets were rich. So we’ve planned for this. We’re going to get through it. The hungry clients are actually the more interesting group, and for those the issue is when do we get in. When do we buy cheap. And there’s no right answer.

Who knows where the bottom is? My favorite analogy is “catching a falling knife,” which is what we’re trying to do. Our policy right now for you guys is we’ll upgrade your asset allocation on request. Now, we recommend that if you increase the asset allocation, you phase in the increase between now and the end of the year. We are not yet recommending that asset allocations be upgraded, but who knows when is the right time? We’re not turning those requests down. We’ll be talking to each and every one of you about that. If you’ve got a mortgage, now’s the time to think about refinancing. Between now and the end of the week, banks will be dropping their interest rates and there are rates now below 3%. So let’s talk about the coronavirus. Much more important than the market is the health of our clients. We know the infection rate is probably about five times the known infection rate and that the fatality rate of 0.6% is probably a good baseline. However, that baseline is not accurate for all people. The number one concern is client welfare. And with a vaccine maybe a year away, the trick this year is to do your best to not catch this infection.

We have an action plan in place both to protect clients who come in to the office and also to encourage clients to work through Zoom. We have fantastic video conferencing technology and we’re going to be discouraging in-person meetings going forward. Encouraging more Zoom meetings. We’re not requiring anything. If you come into the office, we’ll be disinfecting the meeting rooms, the handles, the door handles after every single meeting. More importantly, sooner or later there’s probably going to be some kind of quarantine. There’ll be quarantine for individual employees if they come in contact. There may be quarantine for other employees because their kids are quarantined from school. We have the ability for every single employee to work at home at the same time. The history of Avion wealth was very much based around travel. My travel as we grew. We can run this firm without a soul in the office.

So we have a great business continuity plan in place. We have the equipment. We have, in the meantime, decided to eliminate unnecessary group events. So there is one last caution we do have for clients that may be off your radar with the market and the virus and quarantine and all this other fun stuff for the year. That is scams. This is a target-rich environment for scammers. Be on the alert. It’s natural for your guard to be down, but there are scams galore. Anybody suggests anything that might not make sense? Just go online. Google it. You’ll find out fast if it’s a scam. We wish you the best investment success. We wish you good health. Thank you for your attention.


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Founder & CEO at Avion Wealth

Paul is the founder and CEO of Avion Wealth, LLC. He leads a team of wealth managers in building and executing financial plans for high net worth individuals and families. Contact Avion Wealth to speak with a financial advisor.