Stock market crash peril is boosting interest in alternative investments designed to outperform equities in volatile times.
Investors seeking to dodge stock market crash peril may opt to forgo some potential upside in share-price appreciation to guard against the risk of deep losses. Alternative investments worth considering include selected funds and real estate investment trusts (REITs) that are not highly correlated to the stock market and offer a possible refuge from riding the ups and downs of equities.
Buffeted by threats from the coronavirus, supply chain disruption for manufacturers and quarantines that have idled workers and hurt many businesses, the stock market endured a correction in late February, defined as a dip of at least 10% from the highs for the major indexes. Specifically, the Dow Jones Industrial Average dropped 12% and the S&P 500 slid 11% in the last week of February.
Stock Market Crash Peril Mounts with Oil Price Plunge, Coronavirus Concerns
From the Dow’s all-time high on Feb. 12, it tanked 14.07% through Friday, Feb. 28. In turn, the S&P 500 plunged 12.95% and the NASDAQ Composite sank 12.92% by the close of trading on Feb. 28 from their intraday all-time highs on Feb. 19.
On March 9, the Dow Jones Industrial Average plunged 7.8% to mark its worst one-day percentage dive since October 2008. The Dow was weighed down by the growing coronavirus crisis and a production dispute between Saudi Arabia and Russia that sparked a 24.6% drop in the price of the benchmark West Texas Intermediate crude oil to cause its biggest single-day slide since January 2009.
In addition, the Standard & Poor’s 500 sank 7.6% to absorb its largest one-day percentage retreat since December 2008on March 9, while the NASDAQ Composite cratered 7.3% that day. The three major U.S. stock indexes each now are 19% beneath their record highs set in February 2020 and just 1% above bear market territory.
Paul Dykewicz interviews Bob Carlson (left), who chairs the Board of Trustees of Virginia’s Fairfax County Employees’ Retirement System and leads the Retirement Watch advisory service.
Paul Dykewicz gathers investment tips from Hilary Kramer, whose advisory services include 2-Day Trader, Turbo Trader,High Octane Trader, Value Authority and Inner Circle.
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Paul Dykewicz, www.pauldykewicz.com, is an accomplished, award-winning journalist who has written for Dow Jones, the Wall Street Journal, Investor’s Business Daily, USA Today, the Journal of Commerce,Seeking Alpha, GuruFocus and other publications and websites. Paul is the editor of StockInvestor.com and DividendInvestor.com, a writer for both websites and a columnist. He further is the editorial director of Eagle Financial Publications in Washington, D.C., where he edits monthly investment newsletters, time-sensitive trading alerts, free e-letters and other investment reports. Paul previously served as business editor of Baltimore’s Daily Record newspaper. Paul also is the author of an inspirational book, “Holy Smokes! Golden Guidance from Notre Dame’s Championship Chaplain,” with a foreword by former national championship-winning football coach Lou Holtz.The book is endorsed by Joe Montana, Joe Theismann, Ara Paseghian, “Rocket” Ismail, Reggie Brooks, Dick Vitale and many others. Follow Paul on Twitter @PaulDykewicz.
