Keep Your Financial Cool During the Coronavirus Crisis
Markets have rebounded somewhat after several weeks of declines following continued Coronavirus worries and the oil price drop leaving most major indices 25-30% down. The effect of Coronavirus is still difficult to quantify but where we have difficult to quantify impact events statistically these are usually a short duration impact to bottom of 3-6 weeks with 8 to 12 weeks to recover. Should the Coronavirus lead to a deeper drop into a long term recessionary environment the nadir could last six months and a drop in equity markets in the region of 40% from their peak – either way there is going to be plenty of chop while markets find their level which they are yet to do despite last week’s positivity. "There is no question growth and earnings will be lower in the coming months, S&P500 is trading at an earnings multiple of around 14 down from 20 a few weeks ago which represents reasonable value and seems too pessimistic given other economic data." A call to buy or se