Highest ever levels of market volatility

More than three months from the start of the outbreak, market volatility remains high.

According to research by Asset Management firm Allan Gray, the current levels of market volatility are higher than any time in history; higher than the GFC and September 11th terrorist attacks.

In March, there were nine trading days with volatility above 10%.

Seven of these days were consecutive.

For comparison, during the GFC there were only four days with volatility above 10% and none of them consecutive.

“Despite having fallen from its peaks the COVID-19 volatility remains about twice the average of any other period in history,” the firm claims.

This volatility isn’t inherently a bad thing, though.

The firm also states that extreme fluctuations present long-term buying opportunities.

But this contrarian approach isn’t everyone’s cup of tea.

ASIC has recently issued a warning about the risks of day trading by retail investors in volatile markets, as the number of new trading accounts increased three-fold compared to the normal rate.

For those of us who simply aren’t comfortable investing in a volatile market, now is the time to start exploring other options.

Property, fixed-income, and managed funds are all valid options for investors seeking a stable choice in a period of inherent uncertainty.

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