Investors have reasons to be cheerful despite the coronavirus crisis pushing the world to the brink of the worst economic downturn since the Great Depression.
With two-thirds of the global population of 7.1 billion on lockdown, millions are facing financial hardship and unemployment.
But some investors are ignoring the gloom to find positives to safeguard and even improve their wealth, says Nigel Green, investment expert and CEO of one of the world’s leading financial services firms for expats, deVere Group.
“The world has changed considerably in the past few months. Coronavirus has sparked a truly global crisis like no other, with a horrifyingly high and tragic number of human lives lost,” he said.
Economic upheaval and uncertainty
“It has also been a monstrous source of economic upheaval and uncertainty for households, businesses and governments.
“But in these most unusual of times, it’s essential to seek the positives and there are increasingly significant reasons within the market to be cheerful.
“Looking beyond the gloom, many investors are using these to create, build and safeguard their money right now.”
Green laid out the three investment factors behind his reasoning.
“First, the market is cheap by historic standards and this represents a major, perhaps once-in-a-generation chance to buy top quality equities at lower prices to bolster investment portfolios. History shows that stock markets always go up over time,” he said.
Three reasons for hope
“Second the worldwide loosening of monetary and fiscal policies will serve as a bridge for economies until the crisis passes and will go a long way to boost both supply and demand across all sectors. In turn, this will lead to more investment, increased confidence, and longer-term job and wealth creation.
“Third, pent-up demand will hit the global economy when lockdowns are lifted. Many people have not lost their jobs or suffered reduced incomes and have saved money during the lockdown. We can expect demand in sectors such as autos, travel, hospitality and entertainment to be strong.
“I also would urge investors to mitigate risks to their money and help create and grow wealth by looking towards the undeniable and compelling positive areas amid this tragic and unprecedented global situation.”