Question

Discuss the market behavior the past week on local ( Saudi Arabia)and international basis. Knowing what you know now, what investment strategies would you recommend? Are there any particular stocks you would buy/short? Any orders you would place?

20% Mar Mar 10 Mar 11 Mar 12

Answer 1

Due to the regional conflict in the middle east and other differences of major oil producing countries like Saudi Arabia and Russia, the volatility in the oil price increased sharply. In global markets due to the widespread of the infectious virus, the US market has become very volatile and it fell sharply in the last weeks. The global markets in the last week has been extremely volatile mode because of the fear of widespread of disease and many people are fearing that we are again heading towards the recession. The investment strategy at this time would be avoid going long on equities and even if you are planning to buy large quantities of equity to hoard and sell them once the market becomes stable then the better idea would be to buy high quality stocks from the market and invest certain portion of your portfolio in high quality bonds. At this stage going long on any particular equity stock would not be a good idea until you are really a long-term investor like 10 years or more so better idea would be create a set of portfolios where the diversification is high and overall risk is low.