The Financial Turbulence Due to Coronavirus


Global share markets have fallen hard in the past few weeks due to the Coronavirus pandemic. Understandably, this may cause feelings of uncertainty and worry about your investments and your pension. Consulting with a pension transfer specialist could enlighten you on the situation and help you make informed decisions on what to do with your money in this time of financial turbulence. Your pension fund is a long-term investment, and if that is linked to the volatile markets, significant falls may impact its value. However, it may be challenging to predict the longer-term impact of Coronavirus on financial markets.

Markets are typically concerned with the impact of Coronavirus on economic activity. Restricted supply chains and travel may cause falling prices as these are likely to affect short-term trading performance. While this may negatively impact investors, it is not the best way to predict a long-term or a medium-term slowdown. Demand may also be affected for months, but it should return once the outbreak is under control.

A pension transfer specialist may recommend ensuring that your investments are efficiently diversified throughout the world, so you have a cushion in case any single region experiences a heavy fall. A mix of assets ranging from funds and shares to cash and bonds across different geographies and sectors can help ensure that market volatility during this time doesn’t bring your entire portfolio down.

The UK economy may be challenged by the Coronavirus, but financial institutions and banks are doing their part in assuring their customers. For instance, the Bank of England has declared an emergency package of measures ahead of the UK Budget in an effort to contradict cash flow issues, which many UK households and businesses are likely to face in the coming months. Global policymakers are also taking action, and along with favourable valuations for any risky asset class, you may be assured of comfort in a moderate pro-risk investment strategy. However, your pension transfer specialist may recommend ensuring a resilient portfolio against any downside situation.