The novel coronavirus outbreaks have led to concern about global stocks dropping. While investors are doing their best to assess the potential impact on the global economy, it is difficult.
We don’t know how many people will become infected, how long this cycle will last, or what impact that will have on the economy. However, we do know that you have questions. How is coronavirus going to affect your investments? Let’s discuss it.
The News
If you have watched the news, or read an article online about this virus, you’ve seen that it can be pretty scary. It is important to remember that market prices react immediately to news, whether good or bad.
To avoid potential losses, or make money, we would need to trade before it is news. So don’t give in to the urge to take action and don’t fear the next recession.
Perspective
Keep a clear perspective here. This isn’t the first time a new virus has shocked the world, and sadly, it won’t be the last. Remember the outbreak of SARS, H1N1, Zika, and others.
Many people had the same concerns then. Not just about how the virus would spread but also whether it would impact the economy and investments.
The stock market seems to have short memories regarding these epidemics. While there is initial uncertainty and fear, for the most part viruses are contained. Long-term investment strategies are based on the economic and corporate fundamentals. This is the pattern that the markets have followed in the past.
[Related: Recovery Numbers for Coronavirus]
Be Alert
The final piece of advice we have to offer s to be alert. The Securities and Exchange Commission had to issue a public warning that fraudsters are attempting to play on our natural fear and greed during this uncertain time.
Many online ads and social media posts promising huge profits for investing in companies that have found a cure for the coronavirus. These are scams! Remember, if it sounds too good to be true, it is. There are no real get rich quick schemes when it comes to investing.
Coronavirus and Your Investments
Our advice during this remains the same. Don’t buy into the fear and hype of the media. Stick to your long-term plan. Our investment strategies don’t depend on lucky guesses. We prepare financial plans for you that assume these events will occur, and pass. If you have other questions, please contact Argent Bridge Advisors today. In the meantime, stay positive and wash your hands.
