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MaKe Financial Decisions Update - Keeping calm through this unprecedented storm

It is important that Steve and I keep you as up to date with information that is necessary for you and your loved ones through these unprecedented times.

1. Update on MaKe Financial Decisions

a) We are still open for business; and will be conducting our normal face to face meetings via virtual meetings online. Both Steve and I will be self-isolating along with the members in our team: Iubu, Bobby, Rene and Michael.

b) You can still phone us on our work line (07) 3844 3899. If you cannot reach Steve or myself, please leave a detailed message with our team so they can inform us and we will endeavour to respond to your call as soon as possible.

c)  Our Fax line (07) 3844 2188 will be unattended during this time. If you are requiring a fax to be sent to us, please call our team and we will help you through other means in providing the necessary information to us.

d) We will send you updates via email throughout this pandemic.

e) Below are some topics we need to address with you as areas of interest. In red are action items you should be addressing now if you can.  

2.  Investment Markets – what is happening? 

Steve and I have spoken about not letting your emotions get in the way of investing. This is not a "head in the sand" response, but it will serve you nothing but angst if you constantly check the value of your investments through this crisis.  

Steve’s market observations:

The ASX All Ords began yesterday at 4854 and finished at 4564, whilst today the market finished at 4753 – it recovered most of yesterday’s negative movement. There are two major influences affecting investor sentiment:

(i) the fear around Covid-19, and

(ii) the near 30% fall in crude oil prices as OPEC (led by Saudi Arabia) and Russia are at loggerheads because Russia walked away from an agreement between the two. This resulted in oil production being increased at lower prices!! This price war has led to increased supply when fuel demand is reducing due to Covid-19.  

Locally economists are now expecting a recession first half of 2020 with growth dropping to negative territory for the first two quarters.               

a) In recent weeks, the share markets have been dropping significantly at the start of each trading day – this is mainly irrational ‘forced’ selling by ‘momentum driven’ passive funds (including Exchange Traded Funds [ETF’s], index funds and by extension in Australia – industry super funds that have driven the focus in this country on cost, not the risks associated with growth investments);

b) As an example of this volatility one fund manager (Perpetual) has pointed out this morning that “over the past 10 trading sessions the S&P 500 index has moved more than +4% in nine of them which is something that has never happened before going back 90 years – not even the Great Depression” – this amplifies our point 1 above where the active managers are buying opportunities once the initial drops have happened each day;

c) A report by Chant West last Friday revealed the unlisted asset exposure of QSuper + 9 of the largest industry super funds as at June 2019 – they all ranged between 20% and 33%. And since 06/19 most, if not all these funds would have received large inflows. Once the ‘passive bubble’ burst on 22/2/20, these funds in particular would not have been able to sell any of their ‘unlisted assets’ (direct property as an example) so the only asset they had available to sell would have been their share investments at whatever price they could get, and as the market falls further, they will continue to HAVE to sell as their ‘index based’ passive fund has reduced further.

 So what can be done? The choices are limited:

  • Since the high on 21/02 the ASX has fallen by around 35%, so any switch to cash now is a band aid measure as the damage has largely been done. Once out of the markets, a second decision would need to be made when to enter back into the market. Our client portfolios have fallen approximately 10-15%, nothing like the 35% fall seen on the share markets.

  • The active managers we use are currently invested up to 75% defensively, so are very well placed to invest when they are ready. These active fund managers are looking forward to the increased volatility as it creates distortions in the share markets that they can take advantage of. Whilst they are looking to add value over a minimum of 3 to 5 years, they do not know what your individual timeframes are.

If you want to review your individual circumstances, please do not hesitate to contact us for an appointment.


3. Life Insurance and Income Protection NOT let them lapse

Needless to say, please make sure that under no circumstances is it sensible to allow any Life Insurance or Income Protection covers lapse in the current situation. Any Covid19 deaths or illnesses are covered by most retail insurance policies. BUT some group covers within Industry super do not cover death/illness in a Pandemic, if you are unsure about your cover, urgently ring your super fund and ask the question.

The financial side of this will sort itself out once the human side is dealt with. I will keep you posted on financial implications, but keep yourself and your family safe and well.


 4.  Legacy planning – Review these and take action if required

 a) If you have not reviewed your Will or Enduring Power of Attorney in the past 3 years, please do so.

If you need any amendments to your Legacy planning, we can assist with a referral to e-Lawyers.  

b)  Consider putting in place or updating your Advance Health Directives.

We can provide the government and alternative forms upon request for you to prepare and address with your Doctor if required.


 5.  Unemployment

If your work situation has changed in the past weeks where you find yourself out of work, please let our team know and we will seek to identify options for you.


Above all, please stay safe. Self-isolating will minimise your risk of catching the virus.

If you would like to discuss your individual situation, please contact us on (07) 3844 3899 or

We are here to support you.



Mary, Steve and the Team at MaKe Financial Decisions


MaKe Financial Decisions Pty Ltd

Authorised Representatives

GWM Adviser Services Limited

trading as MLC Financial Planning

Australian Financial Services Licensee