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The coronavirus pandemic has led to an incredibly turbulent time for investors. The initial crash once major world economies shut down was a dramatic event the likes of which the market may only see once in a generation (or at least once in a decade). And though some sectors have already begun to rebound, investors still feel a great deal of uncertainty regarding how and when to move forward. That said, however, even analyses that have acknowledged the degree of uncertainty right now have noted that markets have historically recovered fairly quickly from pandemic events.
To that point, it’s now worth giving some thought to what kinds of investment trends we might see as we begin to ease out of coronavirus lockdowns. While we’re not yet in a “post-coronavirus” world (and may not be for quite some time), countries around the world have improved their capacity to manage the current circumstances. Economies are beginning to reopen, and in the months ahead a lot of investors will be looking to restructure their portfolios.
These are some of the trends we expect to see:
A recent episode of the Rocket Your Dollar podcast covered the real estate market in detail, so we won’t get too far into things again here. Suffice it to say though that we’d expect to see real estate investment pick up as we ease out of the worst days of the coronavirus. Home purchasing is generally viewed as one of the most telling indicators of economic recovery, which is one way of saying this is already something analysts are looking for. But from an investment perspective, we may also see people turning to real estate for two particular reasons: to take advantage of lower prices after a muted period, and to invest outside of the actual stock market (which many still may not trust for a while longer).
We know already that Zoom and some other video conferencing programs have thrived in the time of coronavirus. By supporting remote work, these tools have become absolutely essential in 2020. What we haven’t yet encountered, however, is a full school year starting up with lingering concerns over the virus. In the fall, schools around the world will need to make decisions about when to reopen, whether to welcome students back, and so on. This will almost undoubtedly spark fresh conversation about remote education technologies—not just video conferencing apps, but programs fully designed to facilitate tech-based teaching. We could essentially see the birth of a whole new category of tech tools, and the companies involved could attract significant investment.
Among significant stocks, commodities, and other assets, oil arguably took the biggest hit when the lockdowns began. Demand around the world essentially halted, and prices from some oil providers infamously dipped into negative numbers for a brief period of time. Some believe that oil will never rebound all the way, and that the industry has been permanently damaged. Purely in terms of the price charts, however, oil has risen in value fairly steadily since March. Wisely or unwisely, this is likely to cause some investors to buy back in, attempting to catch any significant oil bounce that may occur as the world continues to reopen for business.
One of the long-term effects of the coronavirus pandemic is likely to be increased focus on clean air and climate control. In homes, people will look into machines that monitor air quality, and ventilation, heating, and air systems that are considered to be clean. Offices are expected to change as well, and while most of that change will concern the ongoing use of conferencing technology and online meetings, it is also likely to mean revamped climate control in physical workspaces. Simply put, people are going to be looking for ways to keep their environments clean and fresh, and related companies—like Honeywell, General Electric, and others—could become trendy among investors.
Finally, we would also expect to see enduring strength and ongoing investment in any and all companies that enable people to stay at home. The idea of being “post-coronavirus” is certainly an appealing one in terms of being able to leave home without worrying. People will be back at shopping malls, in restaurants, and eventually even at concerts and sporting events. However, it’s also likely that a sizable number of people stay in the habit of remaining at home, at least more often than they used to. Additionally, people may simply stick with some of the habits they’ve formed during lockdowns—such as ordering delivery rather than eating out or streaming content rather than going to movies. For these reasons, it could also become trendy to invest in everything from delivery services, to shipping providers, to streaming companies.
The investing landscape may well continue to be unpredictable for a long while yet. Nevertheless, these are among the likelier trends we can forecast as we move past the worst of the pandemic.
Submitted for rocketdollar.com
By Janice Dennis