How should we invest in these troubled times? What attitudes and strategies should investors adopt? How and where can they seek performance while also managing risk? Danielle Goedert, Head of Private Banking Luxembourg, goes through the basics of investing during COVID-19 in an interview for the “Investor Guide” in the December 2020 issue of Paperjam magazine.
2020 has demonstrated yet again that the financial markets are not sunlit uplands. Whether investors are looking to grow their assets or just keep them safe, it can be hard to know how to proceed. “In addition to the shocks we experienced in the spring, the primary long-term repercussions stem from the exceptional measures taken by central banks to support economies,” comments Danielle Goedert, Head of Private Banking Luxembourg at Banque de Luxembourg. “This environment of extremely low rates means that investing in money market or fixed income products has little appeal. As such, defensive investors’ purchasing power is somewhat compromised.”
Favouring quality and long-term performance
“It is vital to invest in high-quality companies that enjoy long-term competitive advantages, solid balance sheets and an ability to set prices,” explains Danielle Goedert. “A single-minded focus on the quality of their investments enables investors to avoid taking excessive risks on the financial markets and to aim for long-term performance.”
The value of responsibility
As well as performance-related matters, the crisis revealed investors’ willingness to adopt a more responsible approach. “It is becoming increasingly important for investors to seek out meaningful, valuable opportunities. Raising the question of environmental, social and governance factors is a key stage in the investment process of today,” asserts Danielle Goedert.
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