I'm seeing some nervousness in the community right now, so I'd like to say a few words of reassurance.
We have an oil crisis here, not a stock market crash. The S&P , the FTSE and the Stoxx 50 were ripe for a correction anyway. But this is really nothing compared to what we've seen during COVID. Once Hormuz is open again, it will take a lot of pressure off the markets. In 1.5 months, the markets could be back to where they were before the Iran conflict. We saw something similar during the pandemic and the situation was even worse then. Many see this more as a buying opportunity.
In the end, the ECB or the Fed could also say a few reassuring words and the market would recover quickly. There is no real fundamental problem with companies at the moment. The Fed probably won't say anything yet because we have an inflation problem due to the higher oil price and the S&P has only fallen -9%. The Fed normally only reacts when the market is heading towards -20%.
Many feel like they have to do something when their portfolio is red. Then they quickly come up with ideas such as betting on commodities, whether oil or gas will rise/fall. But this is exactly what Buffett has always warned against. Even the best equity investors don't have a magic bullet. These prices are determined by geopolitics, not economics.
An intelligent investor can make more money by thinking about productive assets rather than oil prices. Buffet's number 1 rule: don't lose money. Therefore, stick with companies that have strong cash flow, because if inflation is a risk, you should look at companies with a strong MOAT that can easily raise their prices. A good example is Coca-Cola. When prices go up, people still buy. a.k.a defensive consumer sector $XDWS (+1,24 %) . That's why we see momentum in companies like $PG (+0,01 %) or $PM (+0,78 %)
Other companies that can always make money and raise their prices are $MSFT (-1,09 %) , $AAPL (-0,38 %) , $V (-1,76 %) , $SAP (-0,91 %) etc. These companies do not have to constantly make new investments to justify their prices. The MOAT takes care of that. This is very valuable in times of inflation.
