Markets are looking ultra grim this morning. The Eumaeus portfolio down 10% on the month, and that is after a nasty previous month. High yielding bond markets are also suffering badly, with significant investor outflows.
Well it’s all artificial volatility I suppose!
Time for an admission from me, namely that my own pension is largely invested in risky assets. Is that consistent with my view that insurance firms shouldn’t be booking risky profits in advance?
Yes perfectly. I recognise that risky investments are risky, and that the risky profits might not materialise for a long time, perhaps a very long time. I willingly bear that risk. I don’t make commitments that assume the risk isn’t there, and I have household ‘management actions’, namely not going on holiday, cutting down on the port etc, that will absorb the risk if realised.
It will be an interesting year.