Investment approaches during pandemic.

Byline: Nazir Ahmed Shaikh

The entire world is at a war against COVID-19 pandemic. Globally, the magnitude of the negative impact is so huge that some experts have indicated it's going to be even worse than "The Great Depression" witnessed from August 1929 to March 1933.

Global scenario

As the fear of the global economy moving towards a recession grows, it is likely that there will be a liquidity crunch coupled with high inflationary pressures. The conditions accordingly are unlikely to improve till 2021, with an expected $2 trillion shortfall in global income and a $220 billion hit to developing countries (excluding China).

In the given circumstance, it is imperative to take careful budgetary activities, both preventive and remedial, to guarantee the general monetary wellbeing of an individual. At regular intervals, traded on open market organizations report both their real budgetary income and their normal possibilities, in near future. However, for investors, the test is two-fold i.e. foreseeing when that bounce back will come, and picking which stocks will win or lose, when it does. Since the stock market investment crested three months back, tech mammoths have fared well. Retailers are not the organizations have endured as customers remain at home, yet those taking into account home-bodies are flourishing.

The aftermath from the pandemic has made new open doors that natural development pioneers are best ready to catch. By putting more in their pool of advancement ability, giving these individuals the scope to take advantage of these lucky breaks, and empowering reasonable dangers, these development heads will expand their lead further. Organizations are moving quicker and facing greater challenges than could have been envisioned a couple of months back. A further catalyst to re-evaluating built up and lumbering advancement approaches is the quickening of numerous patterns that are as of now in progress. The lock-down has presented a move to on-line work practices and group sharing stages while making new chances.

Local scenario

The COVID-19 virus can be expected to infect developing economies like Pakistan. The classic transmission of exogenous shocks to the real economy is via financial markets as they become part of the problem. As markets fall and household wealth contracts, household savings rates move up and thus consumption must fall. Pakistan was already experiencing rough waters before COVID-19 pandemic struck. Equity markets...