No winter lasts forever and fortune favours the brave. Could the Wuhan virus be the proverbial Black Swan event that investors can exploit? It is still early days of the outbreak of Wuhan virus but wealth builders must prime themselves to strike when the iron is hot.
Amid the global outbreak of the Wuhan virus, there have been media reports of numerous retailers looking to profit from the coronavirus by increasing prices of facial masks. It is not for me to make moral judgements on whether the actions of these retailers are ethical. After all, many of them are businessmen and not charity bodies. But as an investor, I ask myself how I can make money from this Wuhan virus in a responsible, safe and ethical manner.
Health crisis like this Wuhan virus can present opportunities but such crisis only occurs once in a blue moon. Prior to the Wuhan virus, the last flu epidemic that sparked off such global panic was the SARS in 2003. In view of this, wealth builders must be able to spot and seize opportunities when they surfaced. Many investors like to lament that there is a dearth of opportunities in our generation but when opportunities present themselves, investors often don’t dare to take the leap of faith.
A quick and dirty way of making money out of this Wuhan virus is obviously to stock up healthcare supplies (masks and gloves) and then sell them for a handsome profit through online platforms. But generally speaking, I don’t advocate readers to do so as it is rather socially irresponsible in my own opinion.
On the other hand, there are healthcare service providers looking to ramp up their screening services for Wuhan virus by offering lucrative monetary rewards for part-timers. For those who have been jobless for a long time, this is a good opportunity to earn some good money. But of course, there is a need to weigh the risks and benefits. Ultimately, one has to ask themselves whether is it worthwhile to take on such a risk.
In this article, I will share my insights on how wealth builders can seize opportunities in light of this scary Wuhan virus outbreak
SGX shares to buy
The most obvious strategy for investors is to buy into healthcare supplier stocks. Demand for their products is likely to soar for the next six months as the battle against Wuhan virus intensifies. It is still early days but share price of many healthcare suppliers listed in SGX, such as Top Glove, Medtecs International and Riverstone Holdings have already soared. Many of them are penny stocks that were previously thinly traded but Wuhan virus had given these counters plenty of turbocharged power.
Being listed in SGX, these manufacturers should be in the healthcare business for the long haul. Thus, I honestly doubt that they will take advantage of the situation and hike up prices to the retailers, who may pass on the costs to consumers. Also, the adverse publicity will also hurt their corporate image.
Another strategy is adopting a value-buy strategy and buy into stocks which has been temporarily affected by the Wuhan virus. Notable examples are [This is a premium article. The rest of the content is blocked and can be accessible by SG Wealth Builder Members only. To read the full content, please sign up as member.]
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