How do the terrorist attacks in the United States affect your money? What should you do with your investments in the aftermath of this tragedy?
Some investment professionals chose not to comment on the investment situation for fear of being labelled ghoulish.
But managers are charged with looking after and making money for their clients, so they and investors must, at some stage, turn their attention to the economy and how the event may affect them.
Investors must take a long term view of strategic asset allocation. But they can make short term, or tactical, shifts to capitalise on current, or near-term economic events.
The terrorist attacks are a major event, so their impact needs to be factored into investment strategies.
One of the overriding messages from fund managers this week has been that the attacks in the United States have done nothing to force people to make major long term changes to their strategic asset allocation models.
Economics New Zealand managing director Donal Curtin says long term changes need be made only when an event causes major structural shifts.
An example is the oil crisis in 1973.
Despite the awfulness of what has happened in New York, Washington and Pennsylvania, it is not a major economic event.
"It doesn't feel like a financial crisis," AMP Henderson strategist Paul Dyer says.
The markets that have opened have reacted immediately to these events, and, as Alliance Capital New Zealand general manager James Thyne says, they have been quite rational so far.
Shares in companies you expect to suffer - airlines, airports and insurance - dropped in value immediately after the news, while commodity prices, such as gold and oil rose.
Dyer says that judging by the reactions so far, the attacks seem to be a relatively small economic event.
One of the reasons for this may be that markets have been falling for 18 months and don't have much downside left.
He says it is useful to look at Europe to anticipate what will happen in the United States.
Immediately after the attacks, European sharemarkets fell by up to 10 per cent. But they rallied the following day.
Tower Asset Management managing director Paul Bevin says he won't be making any changes to his diversified portfolios.
And Arcus Investment Management manager Simon Botherway says no immediate changes are needed to asset classes. But changes may be needed within classes.
In shares, for instance, what's hot and what's not has changed significantly.
At the start of the week, insurance, financial services and airports were in vogue.
Now they have fallen from investor favour, and defence and building stocks are looked on far more favourably.
In the fixed interest area, Mr Botherway says, the preference will move towards longer dated Government stock.
He says Arcus's main move has been to increase liquidity within its portfolios so it can change investments if necessary.
Bevin says the other area worth looking at is whether share funds should be managed actively or passively.
"The case for active managers has improved quite considerably," he says.
It may seem perverse or unsavory, but many investment professionals say crisis could be a great share-buying opportunity.
The rationale is that people, most probably retail investors, will sell stocks cheaply when the American markets reopen.
We have already seen that happening in the local market.
Guardian Trust Funds Management managing director Anthony Quirk said this week that his company was a net buyer of shares on the local market.
Some stocks were trading at "pretty cheap prices", he says.
"It's not Armageddon from an economic point of view. It's very unusual circumstances."
The general view is that professional, institutional and wholesale investors will sit tight.
Two excellent rules for times like this appear in a book called Contrarian Investment Strategies, by Dave Dreman.
They are: Political and financial crises lead investors to sell stocks. This is precisely the wrong reason. Buy during a panic, don't sell.
And in a crisis, carefully analyse reasons put forward to support lower share prices. More often than not they will disintegrate under scrutiny.
Although these are early days, investors should keep an eye on several factors. The three key ones are:
* How will American consumers react over the next few months?
* Will central banks ease interest rates? If so, by how much?
* What will the politicians do and will there be further terrorist attacks?
The fragile US recovery has for many months been based on consumer spending. Any signs that the Americans are going to close up their wallets and stay at home watching CNN is bad for the economy.
A good outcome would be for them to keep spending.
The other important sign will be the US Federal Reserve cutting interest rates.
One manager believes the Federal Reserve will cut rates by between 50 and 100 points.
If this happens other banks, including our Reserve Bank, may follow suit.
Lower interest rates will be beneficial in kick-starting economic growth, and will be good for borrowers as home loan rates will come down.
By far the hardest thing to predict is what the politicians will do and whether there will be any more attacks.
Dyer says any further attacks will unnerve investors and in all likelihood present bad economic and market outcomes.
The best advice investors can get in a situation like this is simple: Don't get sucked into making decisions because of shock, horror events.
Focus on the fundamental strengths of the companies whose shares you own, and take the benefits of managed funds that offer a broad diversity of investments.
Don't make financial decisions on emotional feelings.
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