“Unprecedented” sounds cliché, but it’s still the best way to describe the current market and economic situation: Interest rates are at all-time lows, inflation is down, commodities have fallen, global trade has declined and unemployment has skyrocketed. Yet what’s also unprecedented is the extraordinary fiscal and monetary efforts to stabilize the economy and help markets recover. So what does this mean for value investing?
As the world comes to grips with the coronavirus and its impacts, we’re finding dislocations in a variety of sectors and strong companies trading at attractive prices. This has led us to add to existing holdings or start new positions in companies that may do well coming out of the crisis.
Going forward, I have confidence in the prospects for testing and a vaccine to combat COVID-19, as well as confidence in finding companies with strong balance sheets and market share to make it through this economic downturn. Watch my latest video for an inside look into where we’re finding these opportunities.
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The opinions expressed are those of American Century Investments (or the portfolio manager) and are no guarantee of the future performance of any American Century Investments' portfolio. This material has been prepared for educational purposes only. It is not intended to provide, and should not be relied upon for, investment, accounting, legal or tax advice.