Making forecasts about the future direction of shares and markets is hard. Faced with a global pandemic of uncertain proportions, it’s next to impossible. Volatility is sweeping the stock market on a daily basis and it’s anyone’s guess just how far the economic impact of coronavirus will spread. Some sectors have been sucker-punched by the crisis, such as airlines, leisure and travel. In a few cases, companies are facing a battle for survival. Early evidence suggests that many others are reinforcing their finances wherever they can. Credit lines are being drawn down, dividends and buybacks are being shelved and in some cases staff are being furloughed. For investors, it’s an incredibly unsettling time. There’s an old saying (originally by John F. Kennedy, I think) that the time to repair the roof is when the sun is shining. During the decade-long equity bull run that came after the financial crisis in 2009 it was easy to forget the wisdom of being prepared for the worst. When it comes to managing a portfolio of shares, taking defensive measures in the good times can easily feel like the wrong choice. But here we are in a situation hardly anyone predicted…
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