Investing in the Midst of a Global Pandemic- An Equity perspective

Investing in the Midst of a Global Pandemic- An Equity perspective

There is no denying that the Coronavirus pandemic is turning out to be the crisis of the century and it is negatively impacting economies, businesses and individuals across the globe but that does not mean that opportunities will cease to exist.



As governments struggle to find a delicate balance between restarting their economies and containing COVID, investors are starting to look for unique opportunities in what is shaping up to be a prolonged period of heightened volatility. The current low interest rate environment makes equities an interesting asset class for investors to consider over fixed income but equities are by nature volatile, which makes disciplined and informed investing essential to generate alpha.



We suggest that you consider the below approach as a good reference point while making equity investment decisions during these challenging times.



Balance sheet strength becomes more important than earnings in short to medium term



Near term visibility on earnings impact from pandemic related shutdowns and loss of revenue is hard to predict. For most companies, 2019 earnings will become meaningless in 2020 and possibly even into 2021. As multiple sectors of the economy go through structural changes during the pandemic, business models and viability are being severely