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COVID-19's most dire impact on the economy is its unique speed. In a matter of one quarter, the demand for some sectors of the economy has fallen to nearly zero. Take airlines as an example. Compared to last year, the number of travelers going through airport TSA has fallen by 97%. Therefore, the source of immediate revenue for airlines has dried down. The situation is no better for restaurant, entertainment, or retail industries. The impact is not as drastic in other industries and sectors. However, a 20% to 30% decline in the revenue of a payment processor and credit company is not unreasonable. It's a no brainer to screen your investment universe for companies with enough cash on their balance sheet to compensate for the lack of revenue without the need to borrow money to fund the day-to-day operations. Focusing on companies with a strong balance sheet would drastically increase the odds of success in the COVID-19 era. What criteria did Stock Card use to populate this new collection? Having a strong balance sheet is a combination of how much cash the company has at its disposal, how much liability or debt it has to cover, and whether the company has the resources to fund its operations without the need to borrow money or raise capital. We used the following nine criteria to generate the strong balance sheet collection:
The result of the above screening is a list of more than 250 stocks that you can easily access, play around, and pick and choose from and create your COVID-19 portfolio. Visit the Strong balance sheet collection. We created this video in response to a question from Matt K. one of our newest users who wanted to know how to use Stock Card to find dividend-paying stocks. You don't have to keep Googling for your stock market research! Don't forget to look up the Stock Card of your favorite companies, and while you are at it, make sure to visit our COVID-19 portfolio.
Today, during a brainstorming session at Stock Card HQ (virtual HQ), we were discussing the seemingly irrational movements of the market during the COVID-19 crash. Our very own Karen Sheng, Head of Data Science, who happens to be a professional trader too, walked us through her analysis as to where the market is headed. We thought you would also enjoy reading it. Thank you, Karen! Reflection on the market from the perspective of a technical trader: The outbreak of COVID-19 and the subsequent nationwide shutdown has been a catalyst for an unprecedented correction of the stock market in a very compressed time frame. Hindsight is always 20/20. This post intends to shed some light on the market behaviors from the perspective of technical analysis. The primary tool used for this analysis is a Fibonacci retracement, which is commonly used to identify support and resistance levels. As we wrapped up a shortened trading week on April 9th, the S&P index was a few ticks away from a critical pivot point, the 50% retracement level at 2793.28. In plain English, the index has recovered approximately 50% from the recent swing low at 2194.83. Where is the market headed to post-Easter? The nuanced answer is that, as a retail investor or trader, we don’t know; however, the Fib levels give us some guidance on where the target is going to be either way. If the market breaks through the resistance, the next resistance level is around 2934. On the other hand, it’s also likely that the index will pull back and test a new low. Is there any evidence for such observation? For the short swing immediately after the all-time high, the index hit the 50% retracement level at 3125 and “puked” afterward. What are the implications for investments? When the market plummets, an average investor would not know where the “bottom” is. However, cost-averaging in the accumulation of stocks in the sectors that are more resilient to the shutdown (e.g., tech sector) could have yielded at least some modest short-terms gains. When the market appears to be rallying again, it’s crucial to fend off the euphoria sentiment (“The bull market is back!” news headlines) and be aware of the resistance and possible pullbacks. Don't forget to look up the Stock Card of your favorite companies, and while you are at it, make sure to visit our COVID-19 portfolio.
Our very own Shama Patwardhan, Head of LiveOps, has published a new portfolio to the Portfolio Store. This portfolio is particularly interesting because of its focus on companies that are shaping the future by making the world smarter. Investing in future-defining companies is always a good strategy. However, it is even more important to go the extra mile and bring our attention to the companies that are shaping the world's future. During the COVID-19 market crash, most investors get bogged down by the day-to-day market fluctuations. However, savvy investors don't take their eyes off of the prize, and that's precisely what this new portfolio is set out to achieve. Scroll down to read about the Smart World portfolio. Invest your money now, to secure your future! Make your money work for you! Every now and then, we come across such advice through articles, books, and news. So why not secure our future, by investing in it? Our future will be highly impacted by advancements in research and technology. Rapidly growing fields such as artificial intelligence, machine learning, big data analytics, and Internet-of-Things would be the backbone of our future. Overwhelmed by the big complex words?! Don't be! It simply means that our future will be dependent on technology that develops fast, high-quality products, makes our devices understand us, and helps us connect with the outside world using the internet. These products have been and will shape our future, giving birth to a Smart World. You have already heard of smart homes, smart cars, and smart cities! So how can we participate in this exciting future? We find strong growing companies that are working towards making the world smarter and invest in them over the long term! As the company succeeds, our portfolio succeeds and rewards us with a strong positive return. Every investor looks for a chance to buy shares when the stock price is undervalued. And that's what's happening now. With the Coronavirus outbreak, the stock market has been consistently falling. Instead of panicking, we look at it as an opportunity to buy great companies at a discounted price!
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