Where to Invest After $12 Trillion Market Cap Wipeout

Summary

• Global equities experienced a record $12 trillion market cap wipeout in a single month, surpassing losses from the Russia-Ukraine war in 2022 and COVID in 2020.
• Underpricing of risks persists, including supply chain disruptions and potential demand destruction from energy infrastructure damage that could take months or years to repair.
• Dina Ting advises investors to focus on long-term horizons and diversification rather than timing market dips.
• Year-to-date, some markets remain positive, indicating differentiated performance based on each country's strategic planning and contingency measures.
• China is highlighted as less impacted due to strategic diversification of energy supplies, large stockpiles, and a shift towards renewable energy.
• Electrification is becoming cheaper, positioning China as a key player in this sector for domestic economy and regional influence in Asia and Africa.
• Specific countries recommended for portfolio diversification include China, Taiwan, and Brazil to balance typical allocations.
• Decreased correlation across equity markets offers opportunities for building less volatile portfolios through uncorrelated assets.
• ETFs are suggested as efficient tools for quick, targeted exposure in portfolio construction, balancing correlation, liquidity, and risk-return.