The global novel coronavirus (COVID-19) pandemic has pushed national economies and health systems intocrisis mode, seemingly overnight.
As the number of positive cases and fatalities, as well as the virus’ reach, escalates at an alarming pace,world leaders and politicians have begun to take drastic measures in an effort to control the spread of thedisease and keep financial markets in check.
In the meantime, institutional investors are questioning what, if anything, they can or should be doing duringthis time to insulate their portfolios from long-term damage. In dark periods like this, asset managers thatstep up to the plate and offer compassionate, relevant and reassuring advice can stand out as shiny beaconsof hope.
Greenwich Investor Resilience Index
Surely, there have been periods of extreme market volatility in the past - and, of course, other widely knownand highly destructive global pandemics. However, what makes this shared experience different is the rapidarrival and immediate paralyzing effect it has had on people’s lives - both personally and professionally - - andthe fact that the volatility is not linked to systemic issues within the global financial system, as was the casewith the 2008 financial crisis. Instead, uncertainty about what the future holds for markets, companies andpeople’s daily lives has led to a series of chaotic responses.
The good news for the asset management industry, at least so far, is that institutional investors seem to beretaining a positive long-term outlook, despite a high degree of distress about what the rest of 2020 will bringand how they will be able to react.