I’m not a Physician, I am a mathematician, so I deal with trends, velocity, momentum, exponentials, and differentials.
People tend to underreact to initial changes in new information and then overreact after they realize they underreacted. That’s when we see the panic and the madness of crowds.
The exponential growth of Coronavirus is likely to be shocking initially in the weeks ahead. As I shared with friends in January, this is an asymmetric uncertainly, and there is a chance for underestimation. So, I hope people are taking the advice of the CDC on things like social distancing, which will help.
What is asymmetric uncertainty?
Asymmetric Uncertainty: Properties of the virus that are uncertain will have a substantial impact on whether the policies implemented are effective. For instance, whether contagious asymptomatic carriers exist. These uncertainties make it unclear whether measures such as temperature screening at major ports will have the desired impact. Practically all the uncertainty tends to make the problem potentially worse, not better, as these processes are convex to uncertainty.
The funny thing is, as social distancing does help “flatten the curve,” many people will believe it wasn’t necessary to start with.
That’s okay, let them believe it.
Christi and I are operating from our home office and prepared to hunker down as long as we need to. We prepared by stocking up supplies we need, which we do to some degree anyway in advance of hurricane season. This year, we just did it early, and more of it. If we don’t eat canned food, it’s a good donation.
In the meantime, the simple way to avoid the virus is to simply avoid situations that could attract it. Beyond that, there are many resources straight from the horse’s mouth that help to track it.
For example, here in Florida, the Florida Department of Health provides updates on its website. Here are the latest updates at this moment. I don’t make the mistake of watching it closely all day, I check it in the morning to see how it’s trending and its rate of change.
A global tracking resource I shared before is the Coronavirus COVID-19 Global Cases by the Center for Systems Science and Engineering (CSSE) at Johns Hopkins University(JHU). At this moment, here are the global numbers. I clicked on Florida to see more detail.
Another is the COVID-19 CORONAVIRUS OUTBREAK by Worldometers.
Again, unless “social distancing” has a very dramatic impact immediately, we should expect to see the rate of change increase exponentially in the days and weeks ahead. For those who aren’t aware or prepared, it may be shocking for a while. If you want to embrace the asymmetric uncertainty, as we are, just hunker down for a while and watch it all unfold.
I have a good reason to, beyond not contracting or spreading the disease, as global markets in a downtrending volatility expansion. I’m trying to make the best of it.
Now is the time to check on our neighbors, friends, and family.
With the social media we have today, we may be physically distant, but we’ve never been more connected.
Beyond that, hang in there friends, this too shall pass. Someday we’ll look back and tell the stories just as we do about Y2K, 9/11, the Gulf Wars, and all the other things we hadn’t experienced before until it happened.
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Mike Shell is the Founder and Chief Investment Officer of Shell Capital Management, LLC, and the portfolio manager of ASYMMETRY® Global Tactical. Mike Shell and Shell Capital Management, LLC is a registered investment advisor in Florida, Tennessee, and Texas. Shell Capital is focused on asymmetric risk-reward and absolute return strategies and provides investment advice and portfolio management only to clients with a signed and executed investment management agreement. The observations shared on this website are for general information only and should not be construed as advice to buy or sell any security. Securities reflected are not intended to represent any client holdings or any recommendations made by the firm. I observe the charts and graphs to visually see what is going on with price trends and volatility, it is not intended to be used in making any determination as to when to buy or sell any security, or which security to buy or sell. Instead, these are observations of the data as a visual representation of what is going on with the trend and its volatility for situational awareness. I do not necessarily make any buy or sell decisions based on it. Any opinions expressed may change as subsequent conditions change. Do not make any investment decisions based on such information as it is subject to change. Investing involves risk, including the potential loss of principal an investor must be willing to bear. Past performance is no guarantee of future results. All information and data are deemed reliable but is not guaranteed and should be independently verified. The presence of this website on the Internet shall in no direct or indirect way raise an implication that Shell Capital Management, LLC is offering to sell or soliciting to sell advisory services to residents of any state in which the firm is not registered as an investment advisor. The views and opinions expressed in ASYMMETRY® Observations are those of the authors and do not necessarily reflect a position of Shell Capital Management, LLC. The use of this website is subject to its terms and conditions.