This week different countries experienced different market movements. US investors are moving from risk-free assets to risky assets. Chinese and European investors are still seeking risk-free assets due to loom forecasts on economy.
It is very interesting to see how historically investor's appetite change over time based on different market situation. The basic rules are:
1.When investor is bearish about economy outlook, investor tend to: a.save more cash; b.sell some overpriced asset and expect to buy back at low price; c.lower their expected price of assets. These caused:a.demands on assets decreased; b.money is less available on market; c.people can't make money on their assets; d.sell pressure for assets increased. e.assets price decrease;
2.When investor is boolish about economy outlook, investor tend to: a.save less cash; b.buy more cheap asset and expect to sell at higher price; c.increase their expected price of assets. These caused:a.demandson assets increased; b.money are more available on marketl; c.people could make money on their assets; d.buy forces for assets increased; e.assets price increase;
Overall, investor's forecasts on economy is important factor for investor making decision.
Other factores investor will consider regarding their investments:a.
Big events:
1.Covid:
Total new covid case no. is rebounding in China. According to current Chinese Covid policy, local communite would be lockdown if any Covid case founded. Current Covid cases are founded mainly in tier 2 and tier 3 cities, such as Guangxi, Gansu, Sichuan, Sichuan, etc. These areas' retailswould be affected by covid. Manufactures would not be affected much. I am expecting more easing on current covid lockdown policy willhappen soon.
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