The top five global risks for investors in 2021 are all surprises to the consensus view:
- Problems with the vaccine rollout,
- Geopolitical and trade tensions do not subside,
- Fiscal and/or monetary policy tightens,
- A “zombie” economy, and
- Interest rate/dollar shock.
History demonstrates that the biggest financial risks in a typical year aren’t usually from out of left field (although a black swan did occur in 2020 with the COVID-19 outbreak). Rather, they are often hiding in plain sight.
Schwab’s 2021 Market Outlook is available now. @LizAnnSonders, @KathyJones, and @JeffreyKleintop share their perspectives on the year ahead: https://t.co/OBPyOTcPBH
— Charles Schwab Corp (@CharlesSchwab) December 11, 2020
Risk appears when there is a very high degree of confidence among market participants in a specific outcome that doesn’t pan out. So, by identifying the unexpected, here are the top five downside global risks for investors in 2021. To read more: https://www.schwab.com/resource-center/insights/content/top-five-global-investment-risks-2021?cmp=em-QYD
Be prepared
Whether or not these particular risks come to pass, a new year almost always brings surprises of one form or another. Having a well-balanced, diversified portfolio and being prepared with a plan in the event of an unexpected outcome are keys to successful investing.
References:
- https://www.schwab.com/resource-center/insights/content/top-five-global-investment-risks-2021?cmp=em-QYD