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In: Economics

what are the Stock investment opportunities in a recession market during the covid 19?

what are the Stock investment opportunities in a recession market during the covid 19?

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Expert Solution

COVID-19 has had an enormous influence on the lives of millions of Americans. Despite nearly 22 million U.S. people applying for unemployment insurance in the past month and one of the worst quarters in the history of the stock market, this pandemic has the ingredients to contribute to a full-scale recession. Some people think that this recession may be one of the worst that the United States has ever experienced. According to a new survey from Investing.com, around 80 percent of investors agree that we are moving into a global recession and about 70 percent agree that a COVID-19 recession would be worse than the financial crisis of 2008.

The financial outlook for the region, though, isn't all doom and gloom. There is a silver lining, and there is a possibility that you will financially come out of the recession in a much better way. Over the past month stock markets have hit historic lows which is not necessarily a positive thing in itself. But low stock rates also mean the market is basically on sale and you can get more bang for your buck by buying now. You've already heard the good financial advice of buying low and selling high and it's a perfect chance to buy low right now. Then, hope the stock prices will be much higher by the time you're able to sell.

The coronavirus pandemic has left a lot of Americans in a rough spot and not everyone can invest right now. If you are going to spend, make sure your funds are set aside in an emergency fund for at least three to six months should you lose your work. It's best to stop touching your money after you invest it, because the last thing you want to do is invest and then you have to pay the bills a month or two later to withdraw your cash.

For many people bear markets have a way to kill capital. That's more a function of how people respond to fear than the inherent uncertainty that accompanies long-term investorship. Everyone is an investing genius when stocks boom, but it's much harder to get good returns on investment when times get rough. For certain cases, when they look the most frightening, stock markets are probably the best ones. The larger the decline in the stock market, the greater the potential to have in the future.


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