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

Mahmut Karayel
04 Apr 2020

MARKETS IN THE CORONA VIRUS CRISIS (Continued on 2019-04-03)

  • This is the update of last weeks' blog as we promised. We have now completed sixth weeks of the COVID-19 Black Swan.
  • The chaotic psyche of the COVID-19 market started to show similarities to the Financial Crisis.
  • Confusion has set in to the markets. Confusion became normal. We also observe some getting used to the bad news.
  • Annualized volatility has decreased a little to 81.5% but is still around the historical high levels.
  • We believe that the reality of jobless claims has not set into the markets yet.

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.

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Suggested Data References in This Article (ALTADATA Marketplace)