Past two days – I liquidated holdings of my Malaysian portfolio at a significant loss. It is a very tough choice, but a necessary action at this juncture. Cash is king. Stay cash (with some bearish-anchored options trades).
I tend to believe that things will only get worse. Indeed, central banks around the world have been doing aggressive monetary easing as well as other quantitative measures. Even with such aggressive moves, it will not address the dropping demand that is due to the fact that people are scared to go out.
One should try to ask oneself on the following key questions:
1. Is the global spread being contained or slowing?
2. What will be the post-impacts on the global economy / markets?
The first question is obviously NO. Although China’s spread has slowed (if the numbers are accurate), total number of cases outside China has clearly exceeded that of China. Europe looks awful, cases in US are rapidly increasing. Malaysia is the no-winter country with the highest number of cases.
Relating to this first question, has a vaccine been successfully developed to deal with covid-19?
Re question 2 – with significant disruptions to supply / demands, alot of businesses will not survive. Alot of job losses. Could this lead to a Global Depression?
Please refer to general disclaimer of this blog. This post is not an investment advice or endorsement.