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Three Investment Tips to Help You Weather the Covid-19 Pandemic

Posted: 13th April 2020 12:13

To say that Covid-19 presents challenges for investors would be an understatement. The current climate is a difficult one to navigate, but it is possible for those who are prepared. Here are three tips to help you make the right investment decisions while we weather this storm.

Don’t Panic

As an investor, it always pays to keep a cool head and to analyze things rationally and objectively. Of course, this is sometimes easier said than done and with the current uncertainty that is plaguing global markets, many investors are naturally concerned about the security of the positions they currently hold.

In investing, as in life, a little bit of anxiety can be a good thing - sometimes it is appropriate to be worried and anxious and feeling those things helps us to identify potential dangers. However, overreacting to those emotions can lead us to make decisions that we later come to regret. Lots of investors are beginning to panic about the security of some of their investments. What seemed like a safe bet last year might now seem very precarious indeed.

While it might be appropriate for you to re-evaluate some of your investments, you should also keep in mind that this pandemic will eventually pass. If you panic sell all your assets now out of fear, you may come to regret it when the economy restarts.

Think Long-Term

Uncertainty is never a good thing for investors - we like it when we can trust markets to behave in a reasonably predictable manner. But right now, no one knows with any certainty what is going to happen beyond the next few days, and even that is subject to change. Under these circumstances, it is understandable that many investors have begun to prioritize short-term considerations, but it is vital not to lose sight of the long-term implications of your decisions.

It is a fallacy to think that short-term decisions are more reliable under the present circumstances. This kind of uncertainty that we are facing right now makes even short-term market predictions much more difficult. Don’t give up on your long-term ambitions and don’t be afraid to plan for a future beyond the current pandemic.

Look for the Golden Geese

Looking around at the impact that Covid-19 is having on businesses across the board, the outlook for most sectors is pessimistic, to say the least. However, there are isolated pockets of the economy that are defying the trend and performing strongly. For example, pharmaceutical and scientific research companies have a lot to offer right now - many of them have seen their stocks increase in value.

Pay close attention to reliable investors like industrialist Chad Brownstein who have experience investing in relatively niche sectors that might be able to benefit from the current crisis. Brownstein’s blog contains a number of worthwhile articles that can provide you with investment inspiration.

The current situation with Covid-19 is less than ideal for investors. But while it presents a number of challenges, it also presents opportunity for those who are able to keep a cool head and make smart investment decisions. Don’t lose sight of your long-term objectives because of short-term pain.

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