If money makes the world go around, undoubtedly, it is market volatility that provides the necessary momentum. Global markets have always required volatility to create investment opportunity, but too much or too little can have a big impact on stability and returns. In 2021, the world faces many uncertainties with multiple factors coming together to create a great instability in almost every sector, country and economic indicator. The only thing investors can be sure of is that change is constant.
Last year, the rapid growth of COVID-19 pandemic found the world ill prepared for the economic chaos and human tragedy that followed. But with the rapid development of effective vaccines to fight the virus, world governments suddenly face a new set of challenges. And a desperate need to supply these vaccines to entire populations, in order to protect human life and avoid a catastrophic economic collapse. Such a huge undertaking could well have far-reaching effects for countries and economies as yet difficult to predict.
The changing shape of ‘The new normal’
Entire business sectors are being completely transformed on a global scale, and in our complex, interconnected world, a change in one sector can cause huge ripples in others. Take the pharmaceutical industry, for example, where leading companies were once accused of price-fixing, now they are producing not-for-profit vaccines, which could help developing countries to fight COVID-19 and get their economies back on track. In the tech sector, remote working is now the norm for people, businesses and governments alike. Companies are already starting to see the cost advantages of remote working and factor them into their long-term projections.
This era of great instability is not a short-term phenomenon. It has long-term implications and, given the events of 2020, will play a major role in how 2021 will unfold and stretch beyond this year and into the decade ahead. Continuing to manifest across governments and companies, sectors and sentiment, affecting policy makers and innovators as they all look to contribute to the most uncertain and unpredictable of times. It’s difficult to foresee what will happen and when; where will the next price shift will occur, and what will fall or thrive. Where will one event have an impact on another, sometimes without warning or even logic. All the permutations, interconnections and variables are immense and complex.
Understanding the instability
So, with the latest part of our Investigator Series, we’re going to investigate in greater depth the main issues underpinning this great instability. We want to help investors navigate through these uncertain times, and equip them with the knowledge to make better-informed investment decisions. We look at all the angles and investigate with an open, inquisitive mind before we invest. Taking a well researched and considered approach can uncover the opportunities. Because in a world of constant change, a consistent approach can make a difference.
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