INVESTMENT PLANNING IN TIMES OF FINANCIAL STRESS
BY JONATHAN GOLD
The COVID-19 crisis of 2020 has taken its toll on the world – the tragic loss of life, the devastating social distancing from loved ones and the financial impact on economies across the globe.
Global equity markets fell sharply from the middle of February, with drawdown levels of -35% in just 4 ½ weeks. Volatility reached record levels, higher even than the Global Financial Crisis of 2008. Safe-haven assets including bonds and gold were not immune to the selloffs.
The response from Central Banks was swift, decisive and coordinated, with interest rate cuts to near zero, stimulus packages greater than the Marshall Plan post WW2 running to trillions of dollars and promises to do ‘whatever it takes’ to support employees and employers.
Markets have recovered some of their losses but remain volatile.
The factors that have led to this crisis differ from any other in living memory. However, as with other previous crises, times of financial stress create opportunities for investment planning and organizing one’s financial assets.
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