The recent Fears in the global markets due to the Coronavirus, the stock in the cellar to fall, and the so-called “Safe haven”investments fared much better. The Dow Jones Industrial Average (DJIA) posted on Thursday its biggest decline and lost more than 1,100 points.
Amidst the Chaos, the investors were considering investing in safe assets such as Gold, silver or Bitcoin. All of these plants also showed dramatic declines – a Situation that leaves investors and analysts confused.
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Inflow of cash?
While the market has shown a significant weakness, moving the investor from the affected by the Virus stocks and into Blue Chips. This has reduced the risk greatly, but the safe investments susceptible to market fluctuations.
In contrast, raw materials and other assets, remained stable or declined. In particular, Gold, silver and Bitcoin have seen all of the lower price points as the market was negatively affected.
This Situation presents a particularly hazardous Situation for investors. Because these “safe harbors” to reveal their lack of stability, could create the General market shift is a source of Loss.
Investors who were frightened by the Coronavirus, may have abandoned positions in favor of stability. As a response, they are not joined, however, to a large extent in the Gold and silver markets.
This could create a relative vacuum between safe ports and shares. Sudden onset of good news – such as a decreased Coronavirus threat or a smaller effect that could push investors quickly in these systems.
Why the risk?
The simple answer is that a Trader could sit in the terminal. A decline in the value could have led to a number of traders to shorten these assets, since the Virus takes its collective sales of the Wind out of the sails.
A sudden increase in value would encourage investment in these assets, and rapidly in the amount.
In addition, investors concerned about further losses could keep out of the market. A sudden increase would, however, mean that virtually all of the potential profits were missed. Whether Bitcoin or Gold would be more affected, remains to be seen.