In this series, members of the Cerno team reflect on the crisis and provide detail on their work and domestic lives.
For our next interview, we caught up with Fergus Shaw, Partner and Co-Manager of TM Cerno Select to hear how he has been coping and adapting to life during this time.
How has the Coronavirus impacted your family?
My family were on holiday in the Philippines when isolation started and have been unable to return to the UK. My daughter is enjoying the constant attention from her mother’s family and is witnessing unpolluted skies over Cebu city which is definitely a rarity. Meanwhile I have taken the opportunity to turn our dining room into a workshop.
In one line, sum up your role at Cerno Capital.
To identify assets that will deliver attractive returns over the long term and manage portfolios of these assets.
What do you love most about working from home?
As a frugal Scot who has never been keen on buying home furnishings, my home has become something of a collection of items scavenged from relatives. Knowing the history of the things I see from my desk induces a sense of permanency which I find calming, and this creates the ideal working environment during a time of acute uncertainty. For example, a bachelor uncle was unfalteringly supportive of his nephews, nieces and assorted hangers-on. He was a sole-trader and dispensed advice from the desk that formed the anchor of his home office. I now find myself working from this same desk.
How are you keeping on top of market movements?
Much market commentary is noise. I was taught this between 1995 and 2001 when I was part of a team which managed international equity portfolios and asset allocation strategies from a converted mill on the banks of the River Spey. Placing ourselves outside the echo-chamber that the City became during the TMT boom was a great advantage and I felt sure that other investment firms would follow us to the countryside and become paperless. How wrong I was! Nonetheless, the lessons I learned then remain in place. In the first instance I prioritise source data and tend to ignore waffle from news vendors. Company announcements are a great source of information, meanwhile I would rather read a Bank of England or Fed announcement as written rather than a Bloomberg interpretation. I have developed a modest list of market indicators which tell me succinctly what is driving markets and can be done from anywhere with an internet connection.
What do you think are the longer-term consequences for the UK/Global Society?
There are many changes I would like to observe in the way humans interact with one and other, but hopefully I will be disappointed as my ideal might be someone else’s nightmare. I do think the trends we have observed over the recent past and which a number of our investments are linked to will become further established. For example, the focus on health and well-being will become further entrenched and the supply chains for the food industry must continue to adapt accordingly. Forcing entire enterprises to operate remotely has demonstrated the positive influence of technology and I do think the way we use commercial property will evolve as a direct result of this period.
Are you taking meetings via ‘Phone or Video?
Either. Working from home has improved calls with the management teams of our investments. Calls made from the office involve moving away from the desk to a meeting room as a courtesy to colleagues. This is not optimal. In the home office, I can make these calls and have all my resources in front of me while also writing notes directly into our database. Of course, we miss out on physical presence and this will be re-established in time.
Have you reconnected with an old hobby during this time?
While I have not raced for a few years, I still consider myself to be a cyclist. Stripping and rebuilding bicycles is something I have always enjoyed but other commitments had seen me put mechanics on the back burner. Over the last couple of weeks, I have caught up on a number of tasks including finishing rebuilding my mountain bike which had gathered dust for over a year and undertaking a full strip and rebuild of my regular training and commuting bike. I find working with my hands to be a great stress reliever and it also rekindles my love of the simple act of cycling. I have no doubt that cycle commuting will see another surge in the near future.
Any books you have been working your way through?
Our minds our incredibly active while we work and working from home allows for a level of focus which can be hard to achieve in the open plan environment. This level of brain activity needs to be kept in check and I find returning to familiar books helpful. Examples include GK Chesterton, The Man Who was Thursday, GB Shaw Cashel Byron’s Profession, Sebastian Faulks, Birdsong, and Aldous Huxley, Eyeless in Gaza. If anything, the ability of a familiar book to bring on reminiscences of the first reading is as powerful as the content.