Covid-19 🦠 portfolio

The Covid-19 reality finally hits Europe, followed by the US in March.

I started to nimble some US stocks last Thursday and was looking at some SG counters before being distracted by my WFH (work from home) meetings.

This WFH is creating inefficiencies at work as my company is split into teams.

Back to this Covid-19. I think the US is totally not prepared and the leadership could have done better for sure. Trump is probably more worried about his re-elections than the health of his citizens.

Let me share with you what are the shares or sectors I am looking at. The aim is to buy stocks that will be "least affected" by the corona 🦠 virus with a time frame of more than 12 months. 

Sectors to look at include:

• Internet-related services and businesses as people spend more time on line and ordering food and groceries or watch movies and listen to music 

• Software as a service business that are considered essential services or backbone to IT infrastructure for businesses. Even during time of distress, such spending is considered non-discretionary. 

• REITs that have long term contractual obligations from stable and large business corporations that will survive this crisis. The tenants are locked in for the long term

Sectors to avoid for now will be those that is considered discretionary consumption or with heavy reliance on tourism dollars such as:

• Airlines - many planes are grounded as countries barred travellers from overseas and non essential travel is cut

• Tourism related - cruise ships is a hot bed for the virus as well as hotels and hospitality REITs that depended on spending by tourists 

• Oil & Gas related counters also suffered from a severe decline in oil prices as demand drops and a price war broke out between Saudi and Russia. It may be a long while before the prices will recover 

• Retail outlets and restaurants are shut in a bid to slow down the viruses and the lack of tourists. Just visit Orchard Road and you will know what I mean. In any case, even without the virus, some retail businesses are already disrupted by online giants such as Amazon or Ali Baba

• Businesses that are disrupted by supply chain issues due to closure of factories eg. businesses that rely heavily on contract manufacturers with China factories etc

I think this crisis may be a good opportunity to start investing. I had previously build up a resilient bonds portfolio over the last few years and will be using the income generated to start investing in stocks. 

As to what I nibbled into last Thursday, they are Alphabet (Google), Amazon, Facebook and Paycom. 

My view is that the markets will probably get worse before it gets better so having the ability to hold your stocks with a longer term horizon is absolutely critical.

That is all for today. Stay safe and be socially responsible!

On a side note, my view is that the elections will be held soon (ie next 3 months) and my bet is June 🤣. PAP sure knows this is a nice window to "rally" the troops and get the mandate. Voters tend to be risk averse during a crisis and will vote for stability. 

In any case, let's give credit where it is due.  I think our government is doing a fantastic job in this crisis (as always). 

Just compare them with the rest of the world and you know what leadership means in times of crisis - From cutting pay for senior management to rewarding the front line fighters. 

I was traveling in Europe when the virus in Italy 🇮🇹 started. I personally felt that it would be safer to be in Singapore than in any of the European countries that I was in! I will share with you my recent bucket list experience in a separate post. 

Happy WFHing!