Today is usually one of my favourite days of the year.
In fact, I enjoy it more than my own birthday (though that's probably natural, given the advancing years).
It's the day when, in previous years, we've written about Northern Territory-listed miners, two stocks that just couldn't lose, and the fact The Motley Fool was poised to become the new naming rights sponsor of The Gabba, Queensland's premier cricket and AFL venue.
It is, of course, April 1.
April Fool's Day.
The company holiday at The Motley Fool.
For years, here in Australia and in the US, on April 1 we've used outlandish, but just-possibly-plausible announcements and articles to have a little fun (the articles get less and less believable as they go on, making sure almost everyone gets the joke by the end).
In the tradition of Shakespeare's 'motley fool' — the mutli-coloured court jester who was the only one who could tell the king the truth without losing his head — who often made his points using stories, we usually try to educate, amuse and enrich on this day by weaving an investing lesson or two into our little joke.
This year, though, we've decided — worldwide — that we won't do our regular April Fool's schtick.
The reason, of course, are the twin realities of an unfolding health crisis, and the resultant stock market falls.
We just figured it might be taken to be in bad taste. And that's fair enough.
If you're someone who wants a little light reading, and a laugh in these tough times, here's a few of our past jokes:
Our first in 2011:
One Hot Stock You Simply Can't Ignore
The follow-up in 2012:
Two 'can't lose' stocks…Your urgent attention is required
And the last couple of years: 2018 and 2019:
Motley Fool Announces Business Transformation
ANNOUNCEMENT: Motley Fool announced as Gabba naming rights sponsor
Frankly, I'm still a little disappointed that the Gabba deal wasn't real, but what can you do?
But, as I wrote above, we're not doing one this year, out of respect. We didn't want to offend anyone who thought it unreasonable.
Personally, as we've seen with some very funny social media takes over the past couple of weeks, I think we can probably all do with a laugh at the moment. So we hope the stories above give you at least a smile.
For those who simply can't see the bright side, yet, we empathise. You might be dealing with health issues, unemployment, or a significantly smaller share portfolio.
Those are stressful, emotionally draining situations to be in.
Hence the cancellation of this year's gag.
Still, we didn't want to miss the opportunity for the 'lesson thing'.
Primarily, The Motley Fool exists to find winning stocks. That's most of what people pay us for.
As part of the deal, though, we want to help our members (and readers) become better investors; to master the art, or to at least understand how to think about investing, so you can maximise your upside and minimise the traps than many investors fall into during their lives.
The latter is why we do our April Fool's jokes in the first place.
So if you'll excuse us the funny set up and bad puns this year (some of you may be relieved!), here are the things I would have wanted you to know if I'd been writing our joke this year:
1. Market slumps are unwelcome, but they're not new.
2. They feel terrible. We never know when they're going to end, and during each one, there is no shortage of people telling us that this is the end of capitalism and we'll all be ruined. (Sometimes, the same people each time. I guess they figure they might be right eventually!).
3. When we're living through a downturn, the very prospect of investing fills us with fear. In hindsight, we can't believe we missed such a great buying opportunity.
4. Yes, the ASX (and its forebears) have been through a pandemic before — in 1919. Not only that, it's been through two world wars, many regional wars, a depression, many recessions, oil shocks, high inflation, stagflation and much, much more.
5. The law (and prudence) mean we can't say 'I promise this will get better'. We can never guarantee anything. But there's no shortage of social media commentary (and some of the usual suspects being quoted in the traditional media) flooding our feeds promising 'end of the world' stuff. It's lopsided, at a time when balance is more important than ever
6. It's our nature, as humans, to weigh the bad news more heavily than an equivalent piece of good news. So, when the scales are even, we still feel negative. Remembering that is important during times like these. It won't stop you feeling worried, upset or even hopeless, necessarily, but your conscious mind can at least recognise that, and deal with it accordingly.
Lastly, and I'm not numbering this one, mainly because it underpins all of the rest, is a simple reality.
As I mentioned above, we can't make promises or give guarantees (because ASIC would frown on it from any financial advice provider but we wouldn't do it anyway, because it's not in our power to give a 100% assurance on anything).
So instead, we'll turn to the past.
In more than a century of ASX history, the market has never failed to regain and surpass a previous market high.
Think it's different this time? That's what they said last time, and the time before.
Yeah, but this time it's really different? They said that, too.
So here's the thing: with the ASX down ~30% from its February highs, there's a ~43% gain on offer if the ASX just gets back to that level.
And then more if — as has always happened before — it goes higher.
Of course it could be different this time. It's always possible.
But likely? I don't think so.
If you were framing a betting market for this — you'd look at two things: past experience, and the depth of the fall.
If you asked a bookie to do just that, I reckon you'd get maybe 100:1 on the 'this time it's different' outcome.
50:1 if you're lucky.
In other words, the other side of the bet — that this time isn't different would pay something like $1.01 or $1.02.
Yet, if I'm right, and the market does go back to it's previous highs, we'll get something like $1.43 for our dollar.
Which is why I'm staying invested, have invested more, and will likely do the same again this week or next.
Which isn't as fun as an April Fool's joke. But I'm sure you'll appreciate why.
And it's very possibly more profitable.
Fool on!
