Lifestyle

Calmer Market Indexes after the COVID-19 Storms

This year has been challenging to the world. The past months have tested the determination and resilience of many, including the market. The world has never witnessed such volatility in recent years. The market right now is a thrashing ocean because of the violent winds and rains that COVID-19 has brought. With such unpredictability, why would anyone brave set sail to brave the storm? Well, oceans are vast, and any seafarer knows that beyond the monstrous waves, howling winds, heavy rains, and dark clouds, are clear blue skies, calm waters, and land. As traders and investors, it is on your shoulders to choose the right vessel for your voyage to that paradise island, and ETFs may be strong enough to get you there.

The Markets Now

In the early months of 2020, many indexes went down by more than -20%. Even the Lunar New Year, a period famous for large financial gains, could not save many Asian markets from the brunt of COVID-19. The Shanghai Stock Exchange was even down by -8.55%. Europe suffered the most as their markets are now below -30% since the year started. The index giants of the United States also had to take a knee, as the Dow Jones Industrial Average, S&P 500, and Nasdaq went down by up to several hundred points. Yet as scary as it may appear for the young bloods of trading and investing, these are nothing new for the hardened. Analyses show that the COVID-19 impacts are similar to other outbreaks of infectious diseases in the last 35 years, such as SARS and Ebola. And what happened to the markets after these outbreaks? They rose.

The Markets of the Future

One of the reasons why COVID-19 had such a significant impact in the markets is technology. News travels faster now, thanks to the advances in telecommunications. Such technology was absent during the Spanish Flu. This fast information also breeds fast fears, and it reflects on people’s spending tendencies. Yet as technology may have contributed to the pain of the markets, it will also bring its salvation. Giants who were on their knees are now standing up. The Dow, S&P 500, and Nasdaq saw their lowest points on March 23rd but has steadily risen since then. The same goes for other US indexes such as the NYSE Composite Index, and the Russell 2000. Asian markets such as South Korea, Japan, Hong Kong, and China are seeing better numbers in more recent days. The S&P/ASX 200 down under is also seeing green as it reached an 11-week high by the end of May and is inching closer to 6,000 points. Since its lowest point in March, the Australian index giant has gone up by around 27%

You can see calmer waters and skies near the horizon. And once these index tides have risen again, you will want to be above water. The ETFs of these indexes may just be the ticket for the cruise you are looking for to carry you to more prosperous land. Apply one of the principles of smart investing, and get an early start, but do not let excitement cloud the rest of your judgement. Even in these hopeful times, keep in mind the rest of the essential principles of smart investing: Diversify, weigh your risks, and spend in line with your financial capabilities. Progress is happening, but it is slow. You are in this for the long run, so take your time as you sail through the storm and into brighter futures.

Author Bio: Kellie is a copywriter and content strategist. She helps businesses stop playing around with content marketing and start seeing the tangible ROI. She loves writing as much as she loves cake.

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