We have already witnessed a 10% correction in the markets and it is possible to have even more sales and it will deepen. Within 10-14 days, however, this is likely to subside, as there will then be more clarity about the coronavirus. This was said by Dragomir Velikov - Chief Investment Oficer, Compass Invest, in the show "In development" hosted by Veronika Denizova.
“We are seeing the beginning of normalization in China. The question is to what extent other countries will be able to implement measures against the disease, similar to the Chinese.”
According to the guest, the coronavirus will certainly have an impact on the economy in the first quarter, probably in the second as well.
He noted that at the moment Compass Invest has no change in terms of its investment plans.
"We are analyzing the portfolios that will be affected in the worst case scenario - a recession in the European Union and the Eurozone" Velikov said.
According to him, the impact of the pandemic will be the most unfavorable on tourist companies, as well as those for consumer goods. "There are companies that should be positively affected - for example, those from the gaming industry, e-commerce companies, as well as food delivery," added the guest.
Velikov also commented on the reason for the increased interest of Compass Invest funds in the technology sector. "Some technology companies have the unique privilege of taking advantage of all the trends. They have a stable cash flow, often with low or zero debt" he explained.
According to the guest, the structure of the capital market in our country should be improved in order to facilitate foreign investors.
"By making it difficult to access the market, liquidity comes. Until there is no fresh resource, we cannot see significant growth" Velikov added.
Watch the whole interview HERE.