Global markets remain extremely volatile, with market swings comparable to those experienced during the worst of the 2008 financial crisis.
We are in a fast-moving and fluid situation with regard to the impact of coronavirus on financial markets. Measures to contain the spread of the virus continue around the globe, with both Australia and New Zealand enforcing travel bans on non-residents. This is seeing economic activity come to a virtual halt in some sectors, such as travel, hospitality, and non-essential retail. These companies have been hit very hard in the market sell-off.
We acknowledge that there is a lot of uncertainty around how this will play out. For investors, key questions include, how long will isolation and travel bans be needed for, and how much harm will this cause to businesses? Our take on the crisis is that we are not currently looking at a full-blown financial crisis at present.
In order to protect against downwards moves, we have increased our cash holdings in the CareSaver funds. We have also avoided companies that are the worst hit, such as airlines and retailers. Instead, we have been looking at quality healthcare and technology companies. We regard our positioning as defensive.
Rest assured that we are watching developments closely and our team is working very hard to achieve superior outcomes for our investors.