Four signals driving Covid-19 investment strategies

Evolving response

clock • 3 min read

Following the escalation of Covid-19 and the seismic shifts across markets, we have witnessed a turning point in investment strategies as money managers move from a phase of crisis management toward more active strategies. Whether it is doubling down on companies with the strongest balance sheets or looking for beta in the anticipated market recovery, we see four key issues that will be critical in shaping the scope and timing of any such strategy.

Evolving investment response In the immediate fallout from the crisis, a number of common steps were taken by nearly all investors. These included active de-risking in the first week of the drawdown, which was fuelled by the need to raise cash and reduce net/gross exposure. More broadly in the market, we initially saw selling programme trades from index and ETFs to accommodate redemptions, however, the trend has reversed somewhat. From an active fund manager perspective, much of the activity was initially on running through existing holdings for balance sheet stress, liquidity risks or...

To continue reading this article...

Join Investment Week for free

  • Unlimited access to real-time news, analysis and opinion from the investment industry, including the Sustainable Hub covering fund news from the ESG space
  • Get ahead of regulatory and technological changes affecting fund management
  • Important and breaking news stories selected by the editors delivered straight to your inbox each day
  • Weekly members-only newsletter with exclusive opinion pieces from leading industry experts
  • Be the first to hear about our extensive events schedule and awards programmes

Join now

 

Already an Investment Week
member?

Login

More on Markets

Square Mile's CIO Mark Harries: Are we in an AI-generated bubble?

Square Mile's CIO Mark Harries: Are we in an AI-generated bubble?

'Only time will tell how the AI revolution reshapes the market'

Mark Harries
clock 17 May 2024 • 4 min read
Market Movers Blog: S&P 500 and Dow Jones hit record highs following US inflation data

Market Movers Blog: S&P 500 and Dow Jones hit record highs following US inflation data

Latest news and analysis

Investment Week
clock 25 April 2024 • 1 min read
How big an impact could global elections have on portfolio allocation in 2024?

How big an impact could global elections have on portfolio allocation in 2024?

US, UK and India main focuses

Investment Week
clock 19 February 2024 • 8 min read
Trustpilot