Investing during pandemic is highly difficult as recession potentially emerges anytime soon. That said, what are smart investing moves during this volatility?
If you look at figures released by numerous institutions, the similar conclusions you can acquire are the major global slowdown happening right now. International Monetary Fund (IMF) expects global growth to be at -3% during the coronavirus pandemic.
Thus, this justifies the urgency to protect your investments as quick as possible. Considering the current market uncertainty, it is hard to do so for one false step can lead to an acute downfall.
For that reason, Pan Jingyi, Market Strategist at IG, and Eli Lee, Head of Investment Strategy at Bank of Singapore, give suggestions on how to protect your investments during the COVID-19 pandemic. Among the tips are to stick to diversification, manage capital cautiously, and maintain long-term outlook.
Also Read: How to Invest during Coronavirus Pandemic
Stick to Diversification
To better understand what to do with your investments, it is better to realize the impact this pandemic can do first. Accordingly, coronavirus pandemic creates uncertainty in myriad sectors. Hence, anything can possibly happen now (including recession).
For this specific reason, diversification will remain an integral part of your investment. Accordingly, by diversifying your investment, you maintain balance should a security greatly collapse.
Cautiously Manage Capital
Capital management is of importance to prevent you from emptying up your account. Again, as uncertainty lingers, investors should also be cautious in their capital management.
Despite many securities showing cheaper prices, that does not mean investors should directly buy it. Investors should be highly cautious and selective in facing this situation.
Maintain Long-term Outlook
While the recessions appear to be unavoidable, investors should still look up to what’s beyond this event. Investors should consider all the factors and closely monitor reports from reputable sources.
However, investing during pandemic is greatly hard to do as it comes with a risk bigger than usual. Still, that does not mean investors should not invest at all.
Also Read: If the Market Crashes, Should You Keep Investing?