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How to adjust your portfolio to coronavirus threat

Those who see an economic impact must decide how deeply the virus will cut.

The economic risks posed by the COVID-19 virus are still unknown. The uncertainty initially led to a caution, and a modest sell-down of Australian shares. Shares then bounced back, as authorities in China moved to contain the virus and stimulate economic activity. Some stronger corporate results boosted the bounce.

New cases of infection in other countries introduced fresh investor nervousness. Global markets had reached a “Goldilocks” juncture. The collective judgment was that the coronavirus outbreak would soften important economies enough to justify central bank support, but not enough to derail them.

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Michael McCarthy is chief market strategist at CMC Markets.

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    Original URL: https://www.afr.com/wealth/personal-finance/how-to-adjust-your-portfolio-to-coronavirus-threat-20200221-p5436w