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Sunday, 29 March 2020
Recently trending Coronavirus and a roadmap for infected investingWhy we’re not buying the market yetDouglass on coronavirus: 'Expect volatility but don't panic'Drawdown reductions needed for retirees - UPDATED POLICYWhat are the possible economic effects of COVID-19 on the world economy?
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We are seeing rapid one-day movements in some large stocks of 10% to 20%, especially those that were 'priced for perfection'. What is causing this, and does it present a threat or an opportunity in a portfolio?
Disruption across many industries often makes it easier to pick the losers than the winners. Short-selling can play an important and legitimate role in an investment portfolio, although it continues to attract criticism.
The market's fixation with whether companies are meeting, exceeding, or falling short of quarterly financial targets is inhibiting market efficiency. Investors would do better focussing on long-term prospects.
In previous cycles, bond yields provided a strong indication of the general health of the economy, but huge coordinated actions by central banks are changing that paradigm. Watch how you read the signals.
The media screams the scary headlines at times like Brexit as the share market reacts to the uncertainty. Investors need to ignore the shouting and accept with equanimity that this is the cost of participation.
Cash gives options over future lower prices, and it avoids the risk of permanent capital loss. But it comes with another risk, the loss of purchasing power, and is not a good long-term investment.
In a widely-quoted scenario using estimated attack and fatality rates of coronavirus, about 0.07% of the population of the US dies. That's about 230,000 people, which the market is not ready for.
Retail investors in fixed interest LITs now realise some structures were not the defensive portfolios they expected, but have prices reached value? Plus it's time to act on stamping fees.
This detailed analysis of infections, deaths, drugs and vaccines includes an optimistic scenario: perhaps US and Australian infection numbers will peak in early to mid-April with a decline after.
Rob Arnott is a leading researcher, fund manager and academic often quoted in US media. We chatted at a moment in time when President Trump must make some critical calls on coronavirus.
The ratio of the S&P500 to the gold price is a useful indicator of the mood of the market. A high ratio indicates that equities are expensive relative to gold, and the ratio has been falling recently.