Markets In The Corona Virus Crisis - Continued (Third Part)

Mahmut Karayel
28 Mar 2020

MARKETS IN THE CORONA VIRUS CRISIS (Continued on 2019-03-27)

  • This is the update of last weeks blog as we promised. We have now completed five weeks of Black Swan.
  • The week of March 23 has seen a comeback. But most big one day comebacks happen during a crash.
  • Annualized volatility of the COVID-19 Reality Crisis is still increasing. It is now at 86.8%.
  • What this means is that there is 1 out of 6 chance that an investor may lose 86.8% of his investment within a year.

More volatility may to come. We are on COVID-19's schedule, not on our schedule. This is totally against conventional business pysche.

Good news:

  • We are viewing this as a worldwide disaster and taking emergency measures.
  • Please take polite requests by the officials seriously.
  • Virus effecting everybody equally has to a large extend silenced the haters and the conspiracy theorists.

When the dust settles, no assumption will be spared. We will re-examine, disect and digest all of our assumptions.

The graph below shows the value of a $10,000 portfolio during the two most severe downturns in the past 80 years.

Comparison of Two Black Swans

Volatility is more severe in the Corona Virus Reality down-turn.

Please share your thoughts in the comments section.

Check out previous posts here:

Suggested Data References in This Article (ALTADATA Marketplace)