Maintaining our overweight in equities
Nevertheless, Danske Bank still expects to see a strong recovery once things look brighter. The uncertainties are when this will happen and how large the dip will be before we see the economy pick up again.
“Generally speaking, we still expect the coronavirus to prove a temporary challenge for the economy and the financial markets.
Making cocksure announcements on precisely when we might be over the worst and see a recovery would be a frivolous venture by me, but history shows us that investors should be wary of selling out when markets are gripped by fear. In the vast majority of cases, the negative reactions are relatively short-lived, and this is also our main scenario here. We are therefore sticking to our strategy at Danske Bank. We continue to have a slight overweight in equities – in other words, a slightly higher share of equities in our portfolios than we expect to have in the long term,” explains the chief strategist.
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