The Joy of a Guide — Liberty Wealth

If you have sent me an email over the last two weeks you will have received my OOO. I am away for the summer – enjoying Europe and the UK. Right now, we are adventuring in the Dolomites (Italian Alps). My friends laugh at me because I get so overexcited about everywhere I visit, but truly, you cannot come to the Dolomites and not be wow-ed.

Last year whilst on holiday in Scotland we discovered the power of having an adventure booked for each day – no waking up and pondering what to do and then realising half the day has gone and the kids are fed up. Instead, each day has a plan and a focus. It takes a bit of work ahead of time, but is absolutely worth it.

Last year was the first time that we took advantage of local guides. We haven’t historically taken expensive trips, but recently we upped our budget. As our earnings have gone up over the years this is one part of our life where we have consciously increased our spending.

Let me explain what a guide can bring to life.

I can read a map, just about. We could take a map and be on our way. We might find some interesting walks or hikes or climbs, but there wouldn’t be anything off the ‘beaten track’. We wouldn’t know what we were looking at or have any idea about the local fauna and flora. There are many things we would miss. We wouldn’t get to the secret hidden gems, or the best vistas, or the great local eating spots. We would have to spend a lot more mental energy working out where we should go and when.

That’s why we hire local, trained, expert guides – different guides for different activities.

First up was hiking.

We had someone by our side to point things out – he taught us about the plants, the trees, the wildlife, the local history. He was able to change the route depending on how tired or energetic we were feeling. He knew the best spots for lunch (a table was even pre-booked at the best mountain hut and we avoided a massive queue) and he gave us the very best experience along the way.

We also spent a day with two guides doing some sport climbing. None of us have ever climbed with ropes before. It was quite the adrenaline rush. Doing this without a guide would obviously have been impossible (without killing ourselves). I learned how to place complete faith in another person and in your equipment, and how listening to your instincts can be the most dangerous thing.

Climbing is a mental sport. You need some upper body strength and decent leg strength (being the right body shape is an added bonus). But mostly it’s about confidence, faith and temperament.

When you get a few meters off the ground, your life is in someone else’s hands. As a beginner, moving higher up the rocks takes a calm demeanour and conviction. You are taught to lean back away from the rocks, pushing against them whilst using the friction in your shoes to keep you in place. It’s the opposite of what your instincts want to do, which is pull close to the rocks. And then on the way down, rappelling is an extreme test of your faith.

I came off the rock twice. The moment that you lose contact is terrifying. But then, a moment later the rope secures you and you find your way back to the rock. It’s not a life and death situation – you are safe. Everything was planned, everything worked just the way it was supposed to. You pull back to the rock, take a deep breath and continue up.

All these different guides - we knew that each had a map, that they knew the terrain back to front and upside down. We knew that they had a backpack that contained all the tools we might need in an emergency (I love to ask guides what is in their backpack). We trusted in them and their equipment. We knew that they could adapt to any changes in the environment.

Having a guide in nature – hiking, biking, climbing – is such a wonderful analogy for what we do. A financial plan is much like a map.

We could give you a map and send you on your way. But there is little value in the map.

The value is in having a guide – a guide who knows the landscape, knows how things change, has the tools in the backpack to make adjustments when things don’t go to plan.

A guide understands the rules of the mountains, the rules of adventure – the rules never change. You always need a way to communicate in an emergency, you carry a first-aid kit, you are always prepared for a change in weather, you know where there is a risk of avalanche, you adapt your trip to the group’s abilities, someone always knows where you are going.

The rules are like our investment philosophy.

Whilst the environment is always changing, the philosophy stays the same. The philosophy is impervious.

Long-term, patient investors don’t react to short-term market volatility.

Whilst the markets are behaving irrationally over the short-term, we are helping our clients behave rationally. We are helping them to ignore their instincts which, as humans, tell us to do all the wrong things, at all the wrong times for all the wrong reasons.

As I write this, the S&P 500 is down about 20% from the highs at the end of 2021. Inflation, interest rate hikes by central banks (to combat that inflation), swings in global foreign exchange rates (affecting companies’ profits), the war in Ukraine and supply shortages have all contributed to recession fears. Some analysts argue a recession is imminent. Others argue that it’s not. Some land somewhere in between. We simply say the future is always uncertain and unpredictable but the long-term trajectory will continue. We never lose faith.

In June, I wrote to clients stating:

“The Great Companies of the World are on sale – they’re enjoying markdowns that historically you don’t see more often than about one year in four, or five, on average.
We know you don’t get fire sale prices unless there’s a fire. And you can argue the current situation with inflation at 40-year highs, interest rates rapidly on the rise, and a war in Europe, is a pretty big fire.
But we always have a choice. We can focus on the fire itself – the media by shrieking about Armageddon are always happy to help us do that. Or we can focus on the sale prices and look ahead to better days which have historically always come next.
Remember, our optimism is increasing each day based on the following observations. 1) As prices decline, value increases. 2) Waiting for clear evidence of a market bottom will mean we will have already missed it. And 3) the first leg up is often as sudden as the last leg down.”

Our optimism has been supported by historical evidence, time and time again:

As your guides, we focus on helping you navigate the markets so that the path is clear.

We have a new guide at Liberty Wealth. If you are not a client you may not have been introduced to Guy.

Guy joined Liberty Wealth in June. Here’s what you need to know about Guy.

Guy Campbell; ex-Goldman Sachs Private Wealth, ex-Sandhurst, ex-Captain in The Royal Dragoon Guards, ex-FFP Advisors. Guy has his CAIA Charter and has passed Level 1 and 2 of the CFA exam (Level 3 in February). He has been itching to get back into Private Wealth and the timing was perfect.

Guy has been an incredible addition to Liberty Wealth. He is smart and ambitious with a maturity and attention to his work that perhaps comes from the military. Even more, he is an all-round great human.

If you want to contact Guy you can find him at guy@libertywealth.ky.

So, we are your guides. And we’re always here if you want to talk it through.

Georgie

georgie@libertywealth.ky