Despite the damage caused by the coronavirus in the equity markets, almost 10% of the investment funds have escaped the drop in the markets.
The crash of march 2020 and the damage caused by the Covid-19 have hit the most of the investment funds, but not all. About 10% of them had at may 25, a gain of more than 2% in 2020, when the Stock market had lost 20%. Rarely available in the banking networks, these funds are available through life insurance policies, multi-purpose, or securities accounts at online brokers. The first winners of the crisis, the bear funds (fund bears) have performance inverted compared to the markets. "These are products that rise when the Stock market decline," sums up Jean-Paul Raymond, a founding partner of the company analysis Quantalys... and, logically, that fall when the markets go up, as was the case in recent years.
In the same register, the funds 'volatility' benefit decreases and suffering increases. Volatility is an indicator of the health of the markets. In times of crisis, the courses of the yo-yo. In march 2020, the CAC 40 lost up to 12% in one day, gaining 8% on another day. Some of the funds to take advantage of this acceleration of stock market fluctuations... but they are penalized by the decrease of the volatility during the growth cycles.
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other categories are showing some positive results on the first month of 2020 as over a longer period of time. "The funds winners have especially taken advantage of trends carriers in specific sectors, such as gold mines or the health and technology", explains Jean-Paul Raymond. Regaining its status as a safe haven, the precious metal has jumped 19% between the march 18 and may 20, at 1765 dollars an ounce. With the increase of search effort and care expenditure, the health sector benefits most directly from the health crisis. Funds specializing in biotechnology companies have gained 12.7 per cent since the beginning of the year to 25 may, followed by the health sector and pharmaceuticals, with average gains of 6.2%, according to Quantalys.
Performance 25/05/2020, sample funds selected
Source : Quantalys.
Few equity funds are distinguishable
Other island of prosperity, the funds in the technology sector increased 5.1% since the beginning of the year. "Their success is not directly linked to the health situation, but the crisis is accelerating the adoption of new technologies, and a lot of companies in the sector have seen their customer base increase during this period", explains Pierre Puybasset, spokesman of the management of the Financial of the Exchequer. Several fund manager can take advantage of these trends, including Exchequer World Next Leaders, Exchequer Robotics or Exchequer Artificial Intelligence.
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No country has been spared by the drop in the markets, but a few equity funds asian are distinguishable, through their investments in health and technology. The fund Matthews China Small Companies has, for example, successfully leveraged the actions of the laboratory CanSino Biologics, the most advanced in the search for a vaccine against the Covid-19. In the classes more diversified, such as fund profiles and flexible, very few products have foiled the downside.