The Russian Crisis and Your Portfolio

Updated: May 4

We found that based on Proverbs 13:11, wealth gained hastily will dwindle but whoever gathers little by little will increase it.



Putting that verse in the context of finances reminds us to not make sudden drastic impulsive moves in your portfolio and above all, start with a plan. There’s a lot going on in our world right now that could impact you, so I want to break down the global challenges going on.


First, of course, we’ve seen a major rise in inflation especially at the gas pump. The overall cost of goods and services have also been rising steadily. The government seems to have finally caught up to what’s been happening for the last 12 months.


Recently, I tuned into a discussion with four Fidelity Investment Asset Allocation experts on the current situation, and there’s a couple of things I want to note from that session. The big question is, what impact does the Russia Ukraine crisis have on your portfolio? We’ve advised our clients against investing directly in oil and attempting to take advantage of the tremendous pain the Ukrainian people are currently going through.


So, it’s interesting to me that a week after mentioning this on the Colin Richards show, oil is now in a bear market from it high. And now it’s lost all that glitter because of the slowdown in China partially related to COVID. It’s quite remarkable how fast things can move. Remember to stay focused on your plan and not make sudden drastic moves or attempt to capitalize on what’s going on in the market since it's so unpredictable.


What impact does the Russia Ukraine crisis have on your portfolio?


Let’s talk about Russia’s position in the global economy. Many are worried that Russia and the sanctions that are quickly spreading throughout the entire world are going to wipe out their portfolio or retirement. We talk to people every single day, who are concerned that events out of their control are going to somehow harm their retirement.


So, we construct a plan for you to achieve financial independence. You can enjoy retirement without worry, and from a Biblical point of view. And the reason we’re building a plan that way, is to empower you to do amazing things for God with the resources He’s put at your disposal. We don’t want you to feel bound financially, but free financially to be a conduit of blessing.


I regularly give updates on my show about what God is doing through Lord and Richard’s charitable giving. Lord and Richards was designed to provide financial advice and help those looking ahead to retirement to achieve financial independence. But we send our profits overseas to some of the poorest people in the world, the people with the least resources to empower them to do amazing things for God. And I’m thrilled to announce that after a two-year shutdown in our Christian school in Northeast India, in the state of Manipur, the government has finally allowed them to resume school again. Praise the Lord!


It’s exciting because as God blesses what we do at Lord and Richards for you, He also blesses His people who have very little. It’s clear that there are people in the world with tremendous needs. And as we worry about our portfolios, I want you to experience financial freedom to help people like that both here in America and wherever God may send you.

Let’s circle back to Russia. They have a big military, a big geopolitical stance, a big landmass, but their economy is rather small, it’s an emerging or developing market. And you know, we invest in emerging markets when we want to throw some dollars in and experience more rapid growth.


In reality, Russia’s economy is only about 1.8% of the annual gross domestic product. In other words, it’s quite small. And it makes up about 3% of the investable, emerging market indices. In the fixed income world, it’s also very light. All of that to say, the impact to most of your investments will be minimal.


Where we may see greater impact is in the commodities market, where of course Russia has a major position in stock, partly in energy stocks but about 20% in their material or goods stock. Ukraine has a similar status in the commodities market. That’s why we call them the Breadbasket of Europe because it’s a major exporter of grains and agricultural products.

The secondary effects, the loss of the commodities that are critical like oil, grains, and breads, have a significant impact on inflation.


The key is staying invested in positions where growth continues.


So how should we address inflation in a portfolio? The great thing is we’ve modeled our plans after historical periods of high inflation. It’s not a surprise that things out of your control will cause inflation to shoot up at some point during your wealth-building or wealth-distributing years.


The key is staying invested in positions where growth continues, even though there may be short term impacts to your portfolio due to stock market volatility, or the swinging of the market.


Last time we really experienced heavy duty inflation was in the late 70s, early 80s. The market kept people out of trouble because some indices quadrupled during a relatively short period. So again, stay invested, stay tuned into your plan. Stay fixated on your long-term goals, rather than panicking and reacting to short-term impacts like inflation or sudden market swings.


We talk to people every day just like you and it’s wonderful to have plans in place for our clients, so they’re able to retire without anxiety. That portfolio is designed to insulate you in many ways from the issues that constantly shake the world. And we know that trouble will only increase as we get closer to the day of our Lord’s return.


I’d love to chat with you and introduce you to our team who have helped countless of people just like you experience financial independence.


Call us at (720) 592-1040 or visit us online at lordandrichards.com




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