How to succeed in investing in a world full of crises. Despite his support for investing in government bonds, Bell stressed that in a world full of wars, trade wars, and agricultural disasters that lead to crop failure, bond yields should be higher than they are now, because they now provide greater protection.
Despite his support for investing in government bonds, Bell stressed that in a world full of wars, trade wars, and agricultural disasters that lead to crop failure, bond yields should be higher than they are now, because they now provide much less protection than they did previously.
Details
He stressed that investors must realize that the old world based on geopolitical stability has become part of the past and that survival in the new world requires abandoning ready-made ideas and accepting fluctuations as a natural part of the investment cost.
For decades, investors have relied on almost fixed investment rules to protect their money in times of turmoil, but these rules have begun to face an unprecedented test, as the world enters a period in which wars, geopolitical conflicts, economic crises, and climate disasters become more frequent.
He stressed that the most dangerous thing an investor can do today is to build his portfolio on the assumption that the world will return to its previous normal, while the reality is that the world will be governed by a permanent state of uncertainty and constant turmoil, which makes the ability to adapt more valuable than the ability to predict.
With every new escalation witnessed by the Middle East region, global markets enter into a new wave of volatility that affects most asset classes, and this is what makes traditional investment rules unsuitable for the era of continuing crises.
Statements
Abu Al-Hassan believes that the successful investor in the next stage will not be the most daring nor the most conservative, but rather the most flexible, as flexibility today has become an investment asset in itself, because it gives its owner the ability to modify his strategy and redistribute assets quickly as circumstances change, stressing that the most dangerous thing an investor can do today is to build his portfolio on the assumption that the world will return to its previous normal, when the reality is that.
